EconPapers    
Economics at your fingertips  
 

Openness and Growth: The Long Shadow of the Berlin Wall

Claudia Buch and Farid Toubal

PSE-Ecole d'économie de Paris (Postprint) from HAL

Abstract: The question whether international openness causes higher domestic growth has been subject to intense discussions in the empirical growth literature. This paper addresses the issue in the context of the fall of the Berlin wall in 1989. We analyze whether the slow convergence in per capita incomes between East and West Germany and the lower international openness of East Germany are linked. We address the endogeneity of openness by adapting the methodology proposed by Frankel and Romer (1999) to a panel framework. We instrument openness with time-invariant exogenous geographic variables and time-varying exogenouspolicy variables. We also distinguish the impact of different channels of integration. Our paper has three main findings. First, geographic variables have a significant impact on regional openness. Second, controlling for geography, East German states are less integrated into international markets along all dimensions of integration considered. Third, the degree of openness for trade has a positive impact on regional income per capita.

Keywords: growth; German re-unification; openness (search for similar items in EconPapers)
Date: 2009-09
References: Add references at CitEc
Citations: View citations in EconPapers (12)

Published in Journal of Macroeconomics, 2009, 31 (3), pp.409-422. ⟨10.1016/j.jmacro.2008.07.004⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
Journal Article: Openness and growth: The long shadow of the Berlin Wall (2009) Downloads
Working Paper: Openness and Growth: The Long Shadow of the Berlin Wall (2009)
Working Paper: Openness and Growth: The Long Shadow of the Berlin Wall (2009)
Working Paper: Openness and Growth: The Long Shadow of the Berlin Wall (2007) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hal:pseptp:hal-00311570

DOI: 10.1016/j.jmacro.2008.07.004

Access Statistics for this paper

More papers in PSE-Ecole d'économie de Paris (Postprint) from HAL
Bibliographic data for series maintained by Caroline Bauer ().

 
Page updated 2025-03-19
Handle: RePEc:hal:pseptp:hal-00311570