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Trade openness, export diversification, and political regimes

Author

Listed:
  • Makhlouf, Yousef
  • Kellard, Neil M.
  • Vinogradov, Dmitri

Abstract

Recent studies have challenged the view that trade openness leads to more specialization in countries’ trade. Using a panel of 116 countries over 35 years, we show that openness can be positively associated with both specialization and diversification, depending on the measure used. Moreover, for developing countries in our sample, the effect of openness on trade structure depends on the type of political regime: in autocracies openness is linked with specialization, whilst in democracies it is related to diversification via export sophistication.

Suggested Citation

  • Makhlouf, Yousef & Kellard, Neil M. & Vinogradov, Dmitri, 2015. "Trade openness, export diversification, and political regimes," Economics Letters, Elsevier, vol. 136(C), pages 25-27.
  • Handle: RePEc:eee:ecolet:v:136:y:2015:i:c:p:25-27
    DOI: 10.1016/j.econlet.2015.08.031
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    References listed on IDEAS

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    1. Olivier Cadot & Céline Carrère & Vanessa Strauss-Kahn, 2011. "Export Diversification: What's behind the Hump?," The Review of Economics and Statistics, MIT Press, vol. 93(2), pages 590-605, May.
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    3. Ricardo Hausmann & Jason Hwang & Dani Rodrik, 2007. "What you export matters," Journal of Economic Growth, Springer, vol. 12(1), pages 1-25, March.
    4. Steve Dowrick & Jane Golley, 2004. "Trade Openness and Growth: Who Benefits?," Oxford Review of Economic Policy, Oxford University Press, vol. 20(1), pages 38-56, Spring.
    5. Spilimbergo, Antonio & Londono, Juan Luis & Szekely, Miguel, 1999. "Income distribution, factor endowments, and trade openness," Journal of Development Economics, Elsevier, vol. 59(1), pages 77-101, June.
    6. Allen Dennis & Ben Shepherd, 2011. "Trade Facilitation and Export Diversification," The World Economy, Wiley Blackwell, vol. 34(1), pages 101-122, January.
    7. David S. Jacks & Kevin H. O'Rourke & Jeffrey G. Williamson, 2011. "Commodity Price Volatility and World Market Integration since 1700," The Review of Economics and Statistics, MIT Press, vol. 93(3), pages 800-813, August.
    8. Julian di Giovanni & Andrei A. Levchenko, 2009. "Trade Openness and Volatility," The Review of Economics and Statistics, MIT Press, vol. 91(3), pages 558-585, August.
    9. José Cheibub & Jennifer Gandhi & James Vreeland, 2010. "Democracy and dictatorship revisited," Public Choice, Springer, vol. 143(1), pages 67-101, April.
    10. Pritchett, Lant, 1996. "Measuring outward orientation in LDCs: Can it be done?," Journal of Development Economics, Elsevier, vol. 49(2), pages 307-335, May.
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    Citations

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    Cited by:

    1. Clement Anne, 2016. "Are Commodity Price Booms an Opportunity to Diversify? Evidence from Resource-dependent Countries," Working Papers halshs-01381143, HAL.
    2. repec:blg:journl:v:13:y:2018:i:1:p:29-40 is not listed on IDEAS
    3. Nicola Daniele Coniglio & Davide Vurchio & Nicola Cantore & Michele Clara, 2018. "On the evolution of comparative advantage: path-dependent versus path-defying changes," SERIES 01-2018, Dipartimento di Economia e Finanza - Università degli Studi di Bari "Aldo Moro", revised Mar 2018.
    4. Clement ANNE, 2016. "Are Commodity Price Booms an Opportunity to Diversify? Evidence from Resource-dependent Countries," Working Papers 201615, CERDI.

    More about this item

    Keywords

    Trade openness; Export diversification; Democracy;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F49 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Other
    • P48 - Economic Systems - - Other Economic Systems - - - Political Economy; Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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