Export Growth and Domestic Performance

Alfredo Pereira and Zhenhui Xu ()

Review of International Economics, 2000, vol. 8, issue 1, 60-73

Abstract: A VAR approach is used to analyze the effects of export growth on the evolution of GDP, domestic employment, and investment in 39 economies. The results strongly support the export‐led growth hypothesis. Export growth affects GDP growth positively in 30 countries. In six countries, all of them inward‐looking, the effects are negative. For these countries, and for these countries alone, export growth has a negative effect on the evolution of both domestic employment and investment. This also suggests the importance of the indirect effects of exports on GDP growth.

Date: 2000
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