Export Externalities and Economic Growth

Co-Authored by: Ibrahim, Izani Feder formulated the first model with an explicit mechanism connecting international trade and economic growth. We present new econometric estimates of this unique model for 30 developing countries studied by Feder. We replicate Feder's 1964v-v73 cross-section estimates for 1974v-v83 and 1984v-v93 and find that the export variables lose significance and that the model has less explanatory power overall. We also try to improve on time-series estimates by Ram and find that the coefficient of Feder's total factor productivity differential in favour of the export sector was positive and significant for 18 of the 30 countries. The export externality coefficient proved to be positive and significant in 13 countries although significant multicollinearity occurs in the regressions for eight of the 13. Comparisons of the results among countries suggest that the impact of exports on growth depends on population size, trade orientation, and the importance of manufacturing.

Publication Information
Article Title: Export Externalities and Economic Growth
Journal: Journal of International Trade and Development (Sep, 2003)
volume 12, no. 3, pp. 257-283
Author(s): MacPhee, Craig R;  Ibrahim, Izani
Researcher Information
MacPhee, Craig R
MacPhee, Craig R
  • Emerging Markets and Transition Economies
  • Import Tariffs and Tax Policies
  • International Trade & Finance
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