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Measuring Economic Openness: A review of existing measures and empirical practices

Author

Listed:
  • Claudius Graebner

    (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)

  • Philipp Heimberger

    (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)

  • Jakob Kapeller

    (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)

  • Florian

    (Institute for Comprehensive Analysis of the Economy, Johannes Kepler University Linz, Austria)

Abstract

This paper surveys existing measures of economic openness understood as the degree to which non-domestic actors can or do participate in a domestic economy. We introduce a typology of openness indicators, which distinguishes between 'real' and 'financial' openness as well as between 'de facto' and 'de jure' measures of openness, and show that this classification indeed captures different dimensions of economic openness. The main contribution of the paper is to supply a comprehensive and novel data set of openness indicators available for interested researchers. Based on this effort, we analyze some trends in economic openness over time and provide a correlation analysis across indicators. Finally, we explore the practical implications of choosing among different openness measures within a growth regression framework and highlight that researchers should make the choice of the indicator based on explicit theoretical justifications that correspond to their specific research questions.

Suggested Citation

  • Claudius Graebner & Philipp Heimberger & Jakob Kapeller & Florian, 2018. "Measuring Economic Openness: A review of existing measures and empirical practices," ICAE Working Papers 84, Johannes Kepler University, Institute for Comprehensive Analysis of the Economy.
    • Handle: RePEc:ico:wpaper:84
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    References listed on IDEAS

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    Cited by:

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    2. Andreas Bergh & Anders Kärnä, 2021. "Globalization and populism in Europe," Public Choice, Springer, vol. 189(1), pages 51-70, October.
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    5. Philipp Heimberger, 2020. "Does economic globalisation affect income inequality? A meta‐analysis," The World Economy, Wiley Blackwell, vol. 43(11), pages 2960-2982, November.
    6. Claudius Gräbner & Philipp Heimberger & Jakob Kapeller & Bernhard Schütz, 2018. "Structural Change in Times of Increasing Openness," wiiw Working Papers 143, The Vienna Institute for International Economic Studies, wiiw.
    7. Nauro Campos & Ekaterina Glebkina & Menelaos Karanasos & Panagiotis Koutroumpis, 2023. "Financial Development, Political Instability, Trade Openness and Growth in Brazil: Evidence from a New Dataset, 1890-2003," Open Economies Review, Springer, vol. 34(4), pages 831-861, September.
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    9. Philipp Heimberger, 2021. "Does economic globalization affect government spending? A meta-analysis," Public Choice, Springer, vol. 187(3), pages 349-374, June.

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