Trade Liberalisation, the Balance of Payments and Growth in Latin America
Penelope Pacheco-Lopez () and
Anthony Thirlwall ()
Authors registered in the RePEc Author Service: Penélope Pacheco López ()
Studies in Economics from School of Economics, University of Kent
Thispaper applies the balance of payments constrained growth model to seventeen countries of Latin America over the period 1977-2002. The crucial parameter to estimate is the income elasticity of demand for imports which is done for Latin America as a whole, as well as for individual countries. As well as estimating over the whole period, the technique of rolling regressions is also used to test whether a trend increase can be discerned as a result of trade liberalisation. A trend increase is found for Latin America as a whole and for some individual countries, and the balance of payments equilibrium growth rate is a good predictor of growth performance in nine of the seventeen countries. There is no evidence that the balance of payments equilibrium growth rate has increased in Latin America as a result of trade liberalisation.
Keywords: Latin America; trade liberalisation; growth; balance of payments (search for similar items in EconPapers)
JEL-codes: C22 C23 F13 F32 F43 (search for similar items in EconPapers)
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Working Paper: Trade Liberalisation, the Balance of Payments and Growth in Latin America (2005)
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Persistent link: https://EconPapers.repec.org/RePEc:ukc:ukcedp:0506
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