Impact of trade openness on poverty: a panel data analysis of a set of developing countries

Basanta Pradhan () and Malvika Mahesh ()
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Basanta Pradhan: Institute of Economic Growth, Delhi
Malvika Mahesh: Institute of Economic Growth, Delhi

Economics Bulletin, 2014, vol. 34, issue 4, 2208-2219

Abstract: The impact of trade openness on poverty has been in the limelight for a few decades now, since most developing countries relaxed their trade regimes. Poverty has always been a central issue for developing countries mainly because of their large vulnerable populations. In this paper, a panel of 25 developing countries is analyzed for three years to determine the effects of trade openness on poverty. We find that poverty has a negative and significant relationship with total trade, imports, exports and merchandise trade. The human capital (education) has negative impact on poverty. We also find that infrastructure and health have a positive impact on per capita GDP. This paper supports the view that an inward-oriented trade policy is neither good for growth nor for poverty.

Keywords: Poverty; Trade; Openness; GDP (search for similar items in EconPapers)
JEL-codes: F1 I3 (search for similar items in EconPapers)
Date: 2014-10-24
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Citations: View citations in EconPapers (12)

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