The Impact of Trade Openness on Economic Stability in Asian Countries

Vu Manh Hoai Nguyen, Tin Huu Ho, Luan Huynh Nguyen and An Thi Ha Pham ()
Additional contact information
Vu Manh Hoai Nguyen: Faculty of Finance and Banking, Van Lang University, 69/68 Dang Thuy Tram Street, Ward 13, Binh Thanh District, Ho Chi Minh City 700000, Vietnam
Tin Huu Ho: Institute for Development and Research in Banking Technology, University of Economics and Law, Ho Chi Minh City 700000, Vietnam
Luan Huynh Nguyen: Faculty of Mechanical-Electrical and Computer Engineering, School of Technology, Van Lang University, Ho Chi Minh City 700000, Vietnam
An Thi Ha Pham: Faculty of Finance and Banking, Van Lang University, 69/68 Dang Thuy Tram Street, Ward 13, Binh Thanh District, Ho Chi Minh City 700000, Vietnam

Sustainability, 2023, vol. 15, issue 15, 1-20

Abstract: The purpose of this study was to investigate the nexus between trade openness and three aspects of macroeconomic stability, including growth stability, inflation stability, and exchange rate stability, in 20 Asian countries from 2011 to 2019. The empirical analysis was carried out with the help of the autoregressive distributed lag (ADRL) model to examine the impact of trade openness on economic stability. Our results revealed that trade openness was negatively associated with the growth stability of the countries located in the Asian region, while the opposite was true for exchange rate stability in the short run. There was, however, no relation between trade openness and inflation stability, which requires further investigation. In addition to contributing new empirical evidence to academic literature, our study expects to have important implications for policymakers. In particular, Asian countries are recommended to speed up the process of trade liberalisation to accelerate long-run economic growth and exchange rate stability.

Keywords: trade openness; macroeconomic stability; Asian countries; ADRL (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://www.mdpi.com/2071-1050/15/15/11736/pdf (application/pdf)
https://www.mdpi.com/2071-1050/15/15/11736/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:15:y:2023:i:15:p:11736-:d:1206373

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().