Multilateral trade liberalisation helps promote export product diversification: Trade tensions damage the prospects of the poorest economies

Sena Kimm Gnangnon

Economic Affairs, 2019, vol. 39, issue 3, 363-380

Abstract: Using a large panel dataset over a 20‐year period, this article explores the effect of multilateral trade liberalisation on export product diversification. Empirical results show that multilateral trade liberalisation is positively associated with export product diversification. However, less‐developed economies experience a greater positive effect than relatively advanced economies. This analysis suggests that if trade tensions reduce cooperation on trade matters among World Trade Organization members, it may hinder export product diversification in developing countries, and the poorest countries might be the most adversely affected.

Date: 2019
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