Trade partner diversification and growth: How trade links matter

Ali Onder and Hakan Yilmazkuday

Journal of Macroeconomics, 2016, vol. 50, issue C, 241-258

Abstract: We analyze the effects of a country’s export connections on its income growth using trade partner diversification (TPD) measures that capture the country’s relative importance in the international trade network. On top of the standard trade openness measures, TPD measures are shown to enter growth regressions positively and significantly, where one standard deviation increase in TPD is associated with a 1–1.5 percentage point increase in the annual growth rate. Threshold analyses show that TPD measures are positively and significantly correlated with growth in countries that have low financial depth, high inflation, low levels of human capital, or high trade openness.

Keywords: Trade; Economic growth; Export networks; Thresholds; Cross-country analysis; Trade partner diversification (search for similar items in EconPapers)
JEL-codes: F13 G20 O19 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (10)

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Related works:
Working Paper: Trade Partner Diversification and Growth: How Trade Links Matter (2016)
Working Paper: Trade partner diversification and growth: how trade links matter (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jmacro:v:50:y:2016:i:c:p:241-258

DOI: 10.1016/j.jmacro.2016.10.003

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