Trade, Remittances, Institutions, and Economic Growth
AbstractThis paper empirically investigates the role of trade, remittances, and institutions in economic development in a large sample of developing countries using recently developed instruments for all these variables. Both cross country (over 30 years) and dynamic panel data (over 5-year periods) regressions of growth rates on instrumented trade, remittances, and institutions provide evidence of a significant impact of trade, institutions, and remittances on growth. While institutions foster growth, remittances hamper it. The effect of trade on growth is positive in cross sectional regressions but ambiguous in dynamic panel data regressions. These results are indicative of a more important role for trade in explaining growth in the very long run than over shorter horizons.
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Bibliographic InfoPaper provided by School of Economics, University of Queensland, Australia in its series MRG Discussion Paper Series with number 2308.
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Other versions of this item:
- Thanh Le, 2009. "Trade, Remittances, Institutions, and Economic Growth," International Economic Journal, Taylor & Francis Journals, vol. 23(3), pages 391-408.
- NEP-AFR-2008-12-01 (Africa)
- NEP-ALL-2008-12-01 (All new papers)
- NEP-DEV-2008-12-01 (Development)
- NEP-FDG-2008-12-01 (Financial Development & Growth)
- NEP-MIG-2008-12-01 (Economics of Human Migration)
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