Openness, Outward Orientation, Trade Liberalization and Economic Performance in Developing Countries
Abstract
This paper deals with the role of trade regimes in determining economic performance and growth in the developing countries. The policy and empirical literatures on trade orientation and economic growth are critically reviewed; it is argued that a key limitation of these works has been the inability to create measures of trade orientation that are: (i) objective; (ii) continuous and (iii) comparable across countries. A growth model that relates trade orientation to the ability to absorb technological progress from the rest of the world is developed for the case of a small country. The model is tested using a new index of trade orientation that is free from the limitations described above. The results obtained using a cross country data set provide strong support to the hypothesis that, with other things given, countries with a less distorted external sector grow faster than those countries with a more distorted external sector. The new theories of economic growth are also discussed, and their usefulness for analyzing the relation between trade orientation and growth in the developing countries is assessed.Download Info
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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 2908.Length:
Date of creation: Mar 1989
Date of revision:
Handle: RePEc:nbr:nberwo:2908
Note: ITI IFM
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Related research
Keywords:Other versions of this item:
- Edwards, Sebastian, 1989. "Openness, outward orientation, trade liberalization, and economic performance in developing countries," Policy Research Working Paper Series 191, The World Bank.
- TF0 - - - - - -
- FUN - International Economics - - - - -
- OPE - Economic Development, Technological Change, and Growth - - - - -
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- Levine, Ross & Renelt, David, 1991. "Cross-country studies of growth and policy : methodological, conceptual, and statistical problems," Policy Research Working Paper Series 608, The World Bank.
- Aitken, Brian J., 1992. "Measuring trade policy intervention : a cross-country index of relative price dispersion," Policy Research Working Paper Series 838, The World Bank.
- Backus, David K. & Kehoe, Patrick J. & Kehoe, Timothy J., 1992.
"In search of scale effects in trade and growth,"
Journal of Economic Theory,
Elsevier, vol. 58(2), pages 377-409, December.
- David K. Backus & Patrick J. Kehoe & Timothy J. Kehoe, 1992. "In search of scale effects in trade and growth," Staff Report 152, Federal Reserve Bank of Minneapolis.
- Tybout, James R., 1991. "Researching the trade - productivity link : new directions," Policy Research Working Paper Series 638, The World Bank.
- Xavier Sala-i-Martin, 1990.
"Lecture Notes on Economic Growth(II): Five Prototype Models of Endogenous Growth,"
NBER Working Papers
3564, National Bureau of Economic Research, Inc.
- Xavier Sala-i-Martin, 1994. "Lecture notes on economic growth (II): Five prototype models of endogenous growth," Economics Working Papers 78, Department of Economics and Business, Universitat Pompeu Fabra.
- Ibarra, Luis Alberto, 1995. "Credibility of trade policy reform and investment: the Mexican experience," Journal of Development Economics, Elsevier, vol. 47(1), pages 39-60, June.
- Nouriel Roubini & Xavier Sala-i-Martin, 1991.
"Financial Repression and Economic Growth,"
NBER Working Papers
3876, National Bureau of Economic Research, Inc.
- Roubini, Nouriel & Sala-i-Martin, Xavier, 1992. "Financial repression and economic growth," Journal of Development Economics, Elsevier, vol. 39(1), pages 5-30, July.
- Havrylyshyn, Oleh & Tarr, David, 1991. "Trade liberalization and the transition to a market economy," Policy Research Working Paper Series 700, The World Bank.
- Sengupta, Jati K. & Okamura, Kumiko, 1996. "Learning by doing and openness in Japanese growth: A new approach," Japan and the World Economy, Elsevier, vol. 8(1), pages 43-64, March.
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