Trade and economic growth: A re-examination of the empirical evidence

Matthias Busse and Jens Koeniger ()
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Jens Koeniger: Ruhr-University Bochum

Economics Bulletin, 2015, vol. 35, issue 4, 2862-2876

Abstract: While trade integration is often regarded as a principal determinant of economic growth, the empirical evidence for a causal linkage between trade and growth is ambiguous. This paper argues that the effect of trade in dynamic panel estimations depends crucially on the specification of trade. Both from a theoretical as well as an empirical point of view one specification is preferred: the volume of exports and imports as a share of lagged total GDP. For this trade measure, a positive and highly significant impact on economic growth can be found.

Keywords: Openness; Trade; Growth (search for similar items in EconPapers)
JEL-codes: F1 F4 (search for similar items in EconPapers)
Date: 2015-12-26
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Citations: View citations in EconPapers (6)

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