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Can Asia Sustain an Export-Led Growth Strategy in the Aftermath of the Global Crisis? An Empirical Exploration

Author

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  • Gonzalo Hernandez

    () (University of Massachusetts Amherst)

  • Arslan Razmi

    () (University of Massachusetts Amherst)

Abstract

Many developing countries have attempted to pursue the East Asian growth model in recent decades. This model is widely perceived to have been based on export-led growth. Given that developed countries are likely to grow at a slower rate and be less willing to run trade deficits in the post financial crisis world, can this growth model be sustained? Using panel data for Asian countries, this paper contributes to addressing this question by distinguishing between different kinds of export- and tradable-led growth in order to more precisely identify the nature of growth in the pre-crisis decades. We find in particular that, among our variables of interest, the proportion of a country's manufactured exports that is destined for industrialized countries is the one most robustly associated with output growth. The results have implications for continued post-crisis growth in Asian developing countries. JEL Categories: F43, O11, O53

Suggested Citation

  • Gonzalo Hernandez & Arslan Razmi, 2011. "Can Asia Sustain an Export-Led Growth Strategy in the Aftermath of the Global Crisis? An Empirical Exploration," UMASS Amherst Economics Working Papers 2011-29, University of Massachusetts Amherst, Department of Economics.
  • Handle: RePEc:ums:papers:2011-29
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    References listed on IDEAS

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    More about this item

    Keywords

    Export-led growth; tradable-led growth; global imbalances; industrialization; capital accumulation.;

    JEL classification:

    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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