An empirical analysis of the causal nexus between service trade and income

Samuel Admassu ()
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Samuel Admassu: Deakin University

Empirical Economics, 2020, vol. 59, issue 2, No 10, 799-816

Abstract: Abstract Service trade has been growing at a higher rate than merchandise trade since the early 1980s. Using an instrument for service trade constructed from trading pair geographical information for 101 countries over the period from 2000 to 2010, this paper estimates the causal effect of service trade on income. The results reveal that a one percentage point increase in service trade increases per capita income by at least 0.1%.

Keywords: Service trade; Income; Growth; Cross-country analysis; Gravity equation (search for similar items in EconPapers)
JEL-codes: F43 O40 (search for similar items in EconPapers)
Date: 2020
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DOI: 10.1007/s00181-019-01680-x

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