Trade, Remittances, Institutions, and Economic Growth

Thanh Le

International Economic Journal, 2009, vol. 23, issue 3, 391-408

Abstract: This paper empirically investigates the role of trade, remittances, and institutions in economic development in a large sample of developing countries using recently developed instruments for all these variables. Both cross-country (over 30 years) and dynamic panel data (over 5-year periods) regressions of growth rates on instrumented trade, remittances, and institutions provide evidence of a significant impact of trade, institutions, and remittances on growth. While institutions foster growth, remittances hamper it. The effect of trade on growth is positive in cross-sectional regressions but ambiguous in dynamic panel data regressions. These results are indicative of a more important role for trade in explaining growth in the very long run compared with over shorter horizons.

Keywords: Economic growth; trade; remittances; institutions (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (129)

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Persistent link: https://EconPapers.repec.org/RePEc:taf:intecj:v:23:y:2009:i:3:p:391-408

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DOI: 10.1080/10168730903119443

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