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Services Trade Policy and Industry Performance in African Economies

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  • Bernard Hoekman
  • Matteo Fiorini
  • Dennis Quinn

Abstract

This paper assesses the potential impacts of services trade liberalization for a sample of African countries. The focus is on the relationship between labour productivity of manufacturing sectors and two types of services trade-related policies – restrictions on foreign direct investment (FDI) in services and restrictions on international payments for invisibles. The analysis takes in account differences across manufacturing sectors in the intensity of use of different services as inputs into production as well as difference in the quality of economic governance across countries. We find that services trade liberalization may have substantial positive impacts on the performance of manufacturing sectors, and increase with services input intensity and the quality of governance.

Suggested Citation

  • Bernard Hoekman & Matteo Fiorini & Dennis Quinn, 2022. "Services Trade Policy and Industry Performance in African Economies," RSCAS Working Papers 2022/75, European University Institute.
    • Handle: RePEc:rsc:rsceui:2022/75
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    References listed on IDEAS

    as
    1. Arnold, Jens M. & Javorcik, Beata S. & Mattoo, Aaditya, 2011. "Does services liberalization benefit manufacturing firms?: Evidence from the Czech Republic," Journal of International Economics, Elsevier, vol. 85(1), pages 136-146, September.
    2. Bernard Hoekman & Ben Shepherd, 2017. "Services Productivity, Trade Policy and Manufacturing Exports," The World Economy, Wiley Blackwell, vol. 40(3), pages 499-516, March.
    3. Hoekman, Bernard & Shepherd, Ben, 2021. "Services Trade Policies and Economic Integration: New Evidence for Developing Countries," World Trade Review, Cambridge University Press, vol. 20(1), pages 115-134, February.
    4. Rajan, Raghuram G & Zingales, Luigi, 1998. "Financial Dependence and Growth," American Economic Review, American Economic Association, vol. 88(3), pages 559-586, June.
    5. Beverelli, Cosimo & Fiorini, Matteo & Hoekman, Bernard, 2017. "Services trade policy and manufacturing productivity: The role of institutions," Journal of International Economics, Elsevier, vol. 104(C), pages 166-182.
    6. Ingo Borchert & Batshur Gootiiz & Aaditya Mattoo, 2014. "Policy Barriers to International Trade in Services: Evidence from a New Database," The World Bank Economic Review, World Bank, vol. 28(1), pages 162-188.
    7. Quinn, Dennis, 1997. "The Correlates of Change in International Financial Regulation," American Political Science Review, Cambridge University Press, vol. 91(3), pages 531-551, September.
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    Cited by:

    1. Benjamin Nitsche & Henry Kofi Mensah & Frank Straube & Vianney Barigye, 2024. "Leveraging the Potential of the African Continental Free Trade Area: Logistics Challenges and Development Paths for Future Value Chains in Africa," Logistics, MDPI, vol. 8(1), pages 1-16, February.

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    More about this item

    Keywords

    Services trade policy; services input use; manufacturing productivity; Africa; regional integration;
    All these keywords.

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