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The effect of World Bank trade adjustment assistance on trade and growth, 1987–2004: Is the glass half full or half empty?

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  • Jinjarak, Yothin
  • Salinas, Gonzalo
  • Tsikata, Yvonne M.

Abstract

This paper studies the association between trade reform, growth, and trade adjustment assistance in a sample of developing countries that underwent trade reforms during 1987–2004. Our analysis explicitly differentiates between a group of countries that received trade adjustment loans from the World Bank and a non-recipient group. The results suggest that trade adjustment assistance is positively associated with economic growth after trade reform in the medium to long run. In comparison to a pre-reform period and to the non-recipient group, the recipient countries registered 0.2 percent higher growth of real GDP per capita, 5.0 percent higher import growth, and 2.5 percent higher export growth over a period of three to five years after trade reform.

Suggested Citation

  • Jinjarak, Yothin & Salinas, Gonzalo & Tsikata, Yvonne M., 2013. "The effect of World Bank trade adjustment assistance on trade and growth, 1987–2004: Is the glass half full or half empty?," Economic Systems, Elsevier, vol. 37(3), pages 415-430.
    • Handle: RePEc:eee:ecosys:v:37:y:2013:i:3:p:415-430
    DOI: 10.1016/j.ecosys.2013.05.004
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    Keywords

    International financial institutions; Trade reform; Sample selection;

    JEL classification:

    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy

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