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Transition Dynamics and Trade Policy Reform in Developing Countries


  • Francois, Joseph
  • Nordström, Håkan
  • Shiells, Clinton R.


This paper emphasizes the relevance of classical transition dynamics for trade policy, particularly for developing countries. The empirical evidence from cross-country growth regressions points to important transitional growth effects related to trade policy reforms. The paper employs a simple growth model to examine these effects, formally developing the transitional dynamics and contrasting policy reforms in countries near steady state (developed countries) with countries far from steady state (developing). Policy reforms that appear identical in a static or steady-state framework can have a substantially greater impact on developing countries, once transitional accumulation effects have been accounted for.

Suggested Citation

  • Francois, Joseph & Nordström, Håkan & Shiells, Clinton R., 1996. "Transition Dynamics and Trade Policy Reform in Developing Countries," CEPR Discussion Papers 1452, C.E.P.R. Discussion Papers.
  • Handle: RePEc:cpr:ceprdp:1452

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    Cited by:

    1. Sylvain Chabe-Ferret & Julien Gourdon & Mohamed Ali Marouani & Tancrède Voituriez, 2007. "Trade-Induced Changes in Economic Inequality: Assessment Issues and Policy Implications for Developing Countries," Working Papers DT/2007/11, DIAL (Développement, Institutions et Mondialisation).
    2. Trejos, Sandra & Barboza, Gustavo, 2015. "Dynamic estimation of the relationship between trade openness and output growth in Asia," Journal of Asian Economics, Elsevier, vol. 36(C), pages 110-125.
    3. Feeney, JoAnne, 1999. "International risk sharing, learning by doing, and growth," Journal of Development Economics, Elsevier, vol. 58(2), pages 297-318, April.

    More about this item


    Development; Growth; Investment; Trade;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies


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