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Does a Stronger Business Environment Increase Export Variety?

Author

Listed:
  • Hua Yin
  • Qing Xie
  • Dinggen Zhou

Abstract

Optimizing the business environment is a new competitive edge to global economies in international competition and cooperation. Export variety is an important basis for the implementation of a country’s foreign trade diversification strategy. However, the impact of the business environment on export diversity remains unclear. Using World Bank Doing Business data and detailed product data of 145 countries from 2010 to 2018, we investigate the effects of the business environment on the export variety of home countries. We separate regulatory variables based on different stages of a firm’s life cycle and examine which regulatory factors of doing business influence export variety. The results show that business environment improvement promotes export variety through an increase in foreign direct investment (FDI). The improvement of the business environment promotes the export variety mainly in non-high-income countries but not in high-income countries. Dealing with construction permit negatively affect export variety, while trading across borders and resolving insolvency improve export variety.

Suggested Citation

  • Hua Yin & Qing Xie & Dinggen Zhou, 2022. "Does a Stronger Business Environment Increase Export Variety?," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 58(12), pages 3395-3415, September.
    • Handle: RePEc:mes:emfitr:v:58:y:2022:i:12:p:3395-3415
    DOI: 10.1080/1540496X.2022.2045942
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