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Market Access, Openness and Growth

  • John Romalis

This paper identifies a causal effect of openness to international trade on growth. It does so by using tariff barriers of the United States as instruments for the openness of developing countries. Trade liberalization by a large trading partner causes an expansion in the trade of other countries. Trade expansion induced by greater market access appears to cause a quantitatively large acceleration in the growth rates of developing countries. Eliminating existing developed world tariffs would increase developing country trade to GDP ratios by one third and growth rates by 0.6 to 1.6 percent per annum.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 13048.

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Date of creation: Apr 2007
Date of revision:
Handle: RePEc:nbr:nberwo:13048
Note: ITI
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