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Export Performance and Trade Facilitation Reform: Hard and Soft Infrastructure

  • Portugal-Perez, Alberto
  • Wilson, John S.

We estimate the impact of aggregate indicators of “soft” and “hard” infrastructure on the export performance of developing countries. We derive four new indicators for more than 100 countries over the period 2004–07. Estimates show that trade facilitation reforms do improve the export performance of developing countries. This is particularly true with investment in physical infrastructure and regulatory reform to improve the business environment. The findings provide evidence that the marginal effect of the transport efficiency and business environment improvement on exports appears to be decreasing in per capita income. In contrast, the impact of physical infrastructure and information and communications technology on exports appears increasingly important the richer a country becomes. We also find statistical evidence on the complementarity between hard infrastructure and soft infrastructure, as captured by our indicators. Finally, drawing on estimates, we compute illustrative ad-valorem equivalents of improving each indicator halfway to the level of the top performer in the region.

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Article provided by Elsevier in its journal World Development.

Volume (Year): 40 (2012)
Issue (Month): 7 ()
Pages: 1295-1307

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Handle: RePEc:eee:wdevel:v:40:y:2012:i:7:p:1295-1307
Contact details of provider: Web page: http://www.elsevier.com/locate/worlddev

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  1. John S. Wilson & Catherine L. Mann & Tsunehiro Otsuki, 2005. "Assessing the Benefits of Trade Facilitation: A Global Perspective," The World Economy, Wiley Blackwell, vol. 28(6), pages 841-871, 06.
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  5. Santos Silva, Joao M C & Tenreyro, Silvana, 2011. "poisson: Some convergence issues," Economics Discussion Papers 3534, University of Essex, Department of Economics.
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  11. Ferro, Esteban & Portugal-Perez, Alberto & Wilson, John S., 2011. "Aid to the services sector : does it affect manufacturing exports ?," Policy Research Working Paper Series 5728, The World Bank.
  12. Elhanan Helpman & Marc Melitz & Yona Rubinstein, 2008. "Estimating Trade Flows: Trading Partners and Trading Volumes," The Quarterly Journal of Economics, Oxford University Press, vol. 123(2), pages 441-487.
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  14. Matthias Helble & Catherine Mann & John Wilson, 2012. "Aid-for-trade facilitation," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 148(2), pages 357-376, June.
  15. Djankov, Simeon & Freund, Caroline & Pham, Cong S., 2006. "Trading on time," Policy Research Working Paper Series 3909, The World Bank.
  16. McCallum, John, 1995. "National Borders Matter: Canada-U.S. Regional Trade Patterns," American Economic Review, American Economic Association, vol. 85(3), pages 615-23, June.
  17. Alberto Behar & Benjamin D. Nelson, 2009. "Exports and Logistics," Economics Series Working Papers 439, University of Oxford, Department of Economics.
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