Does international trade promote economic growth? Europe, 19th and 20th centuries

Oscar Bajo-Rubio () and María del Carmen Ramos-Herrera

Economic Analysis and Policy, 2024, vol. 84, issue C, 561-575

Abstract: In this paper, we analyse the relationship between international trade and economic growth in an unbalanced panel of 20 European countries in a long-term perspective, since the mid-19th century to present days, differentiating between the periods before and after the start of the Second World War. To this end, we perform Granger-causality tests between exports and GDP, and between imports and GDP, following the novel methodology of Juodis et al. (2021) for panel data models with large cross-sectional and time series dimensions. Our results support the existence of a bi-directional relationship between both trade variables and GDP, for the whole period and across subperiods.

Keywords: International trade; Economic growth; Europe; Granger-causality (search for similar items in EconPapers)
JEL-codes: F41 F43 N10 O47 (search for similar items in EconPapers)
Date: 2024
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Working Paper: Does international trade promote economic growth? Europe, 19th and 20th centuries (2023)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecanpo:v:84:y:2024:i:c:p:561-575

DOI: 10.1016/j.eap.2024.07.019

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