Estimating the Constraints to Trade of Developing Countries

Jean-Jacques Hallaert, Ricardo Cavazos-Cepeda () and Gimin Kang
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Gimin Kang: OECD

No 116, OECD Trade Policy Papers from OECD Publishing

Abstract: The severity of binding constraints to trade expansion in developing countries and the importance of the complementary policies that will maximize the impact of trade reforms on trade and economic growth are identified and quantified in this report. As trade-related needs of developing countries are numerous, such quantification is needed to identify the most binding constraints to guide the sequencing of reforms and aid-for-trade interventions. The constraints to trade expansion are largely country specific. However, countries which share important characteristics may face similar binding constraints. An econometric analysis is undertaken for as many partner countries as possible to produce an �\unrestricted sample. that can be used as a benchmark against which special country groupings can be assessed. The econometric work relies on experimentation to identify and rank (based on their relative severity) the most binding constraints for each country grouping. Two case studies, on Azerbaijan and Uganda, illustrate the mechanisms of the econometric work and the importance of several variables not captured because of data limitations

Keywords: aid for trade; binding constraints; developing countries trade; landlocked countries; resource rich countries; small and vulnerable economies; taxonomy of constraints; trade expansion (search for similar items in EconPapers)
JEL-codes: F1 (search for similar items in EconPapers)
Date: 2011-06-24
New Economics Papers: this item is included in nep-dev and nep-int
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Citations: View citations in EconPapers (7)

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