Trade Openness and Economic Growth: Panel Data Evidence from Sub-Saharan Africa

Markus Brueckner; Daniel Lederman

doi:10.1111/ecca.12160

Trade Openness and Economic Growth: Panel Data Evidence from Sub-Saharan Africa

Markus Brueckner
, Daniel Lederman

Research output: Contribution to journal › Article › peer-review

Abstract

This paper uses an instrumental variables approach to estimate the relationship between trade openness and economic growth in Sub-Saharan Africa. Instrumental variables estimates show that economic growth has a significant negative contemporaneous effect on trade openness, while trade openness has a significant positive effect on economic growth. A 1 percentage point increase in the ratio of trade over GDP is associated with a short-run increase in growth of approximately 0.5% in a given year; the cumulative long-run effect on the level of GDP per capita is larger, reaching about 2%.

Original language	English
Pages (from-to)	1302-1323
Number of pages	22
Journal	Economica
Volume	82
DOIs	https://doi.org/10.1111/ecca.12160
State	Published - 1 Dec 2015
Externally published	Yes

Bibliographical note

Publisher Copyright:
© 2015 The London School of Economics and Political Science.

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

SDG 8 Decent Work and Economic Growth
SDG 17 Partnerships for the Goals

ASJC Scopus subject areas

Economics and Econometrics

Access to Document

10.1111/ecca.12160

Cite this

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title = "Trade Openness and Economic Growth: Panel Data Evidence from Sub-Saharan Africa",

abstract = "This paper uses an instrumental variables approach to estimate the relationship between trade openness and economic growth in Sub-Saharan Africa. Instrumental variables estimates show that economic growth has a significant negative contemporaneous effect on trade openness, while trade openness has a significant positive effect on economic growth. A 1 percentage point increase in the ratio of trade over GDP is associated with a short-run increase in growth of approximately 0.5\% in a given year; the cumulative long-run effect on the level of GDP per capita is larger, reaching about 2\%.",

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N2 - This paper uses an instrumental variables approach to estimate the relationship between trade openness and economic growth in Sub-Saharan Africa. Instrumental variables estimates show that economic growth has a significant negative contemporaneous effect on trade openness, while trade openness has a significant positive effect on economic growth. A 1 percentage point increase in the ratio of trade over GDP is associated with a short-run increase in growth of approximately 0.5% in a given year; the cumulative long-run effect on the level of GDP per capita is larger, reaching about 2%.

AB - This paper uses an instrumental variables approach to estimate the relationship between trade openness and economic growth in Sub-Saharan Africa. Instrumental variables estimates show that economic growth has a significant negative contemporaneous effect on trade openness, while trade openness has a significant positive effect on economic growth. A 1 percentage point increase in the ratio of trade over GDP is associated with a short-run increase in growth of approximately 0.5% in a given year; the cumulative long-run effect on the level of GDP per capita is larger, reaching about 2%.

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Trade Openness and Economic Growth: Panel Data Evidence from Sub-Saharan Africa

Abstract

Bibliographical note

UN SDGs

ASJC Scopus subject areas

Access to Document

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