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Developing Country Exports of Manufactures: Moving Up the Ladder to Escape the Fallacy of Composition?

Arslan Razmi () and Robert Blecker ()
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Arslan Razmi: Department of Economics, University of Massachusetts - Amherst

No 2006-06, Working Papers from American University, Department of Economics

Abstract: This paper tests for a ‘fallacy of composition’ by analysing the demand for exports of the 18 developing countries that are most specialised in manufactures in the markets of the 10 largest industrial countries. Estimated export equations (both time-series and panel data) suggest that most developing countries compete with other developing country exporters rather than with industrialised country producers. A smaller number of countries that export more high-technology products compete with industrialised country producers and also have higher expenditure elasticities for their exports. Thus, the fallacy of composition applies mainly to the larger group of countries exporting mostly low-technology products.

Keywords: Developing country exports of manufactures; intra-developing country competition; fallacy of composition; real exchange rates; technological ladder; adding-up constraint. (search for similar items in EconPapers)
JEL-codes: F14 O14 O19 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2006-04
New Economics Papers: this item is included in nep-dev and nep-reg
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Downloads: (external link)
https://doi.org/10.17606/d419-0p89 First version, 2006 (application/pdf)

Related works:
Journal Article: Developing Country Exports of Manufactures: Moving Up the Ladder to Escape the Fallacy of Composition? (2008) Downloads
Working Paper: Developing Country Exports of Manufactures: Moving Up the Ladder to Escape the Fallacy of Composition? (2006) Downloads
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