International trade and Economic growth: cross-country evidence

Josheski, Dushko and Lazarov, Darko (2012) International trade and Economic growth: cross-country evidence. GRP International Journal of Business and Economics, 1 (2). pp. 85-95. ISSN 2048-8556

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Many empirical studies have been done to investigate whethere growth is influenced by international trade. But despite the great effort that has been devoted to studying the issue, there is little persuasive evidence concerning the effect of trade on growth. The main subject of our paper is to summarize the main findings based on empirical research that have been done to investigate the relationship between the trade and economic growth by using data for 208 regions and countries in OLS regression analysis. Our results from empirical investigation show: 1) the ratio of trade volume (sum of exports and imports at current prices-current openness or sum of exports plus sum of imports) to GDP as a proxy of trade openness has positive effect on economic growth, 2) black market premium as a proxy for imbalance in macroeconomic policies has negative effect, 3) in the presence of macroeconomic policies, trade has statistically and economic significant positive influence on growth, and 4) in an institutional environment trade lacks influencing growth, the coefficient on institutions is positive and statistically significant.

Item Type: Article
Subjects: Social Sciences > Economics and business
Divisions: Faculty of Tourism and Business Logistics
Depositing User: Dusko Josevski
Date Deposited: 21 Nov 2012 14:06
Last Modified: 21 Oct 2014 13:34

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