Trade Integration and Growth : Evidence from Sub-Saharan Africa
This paper examines the growth effects of different dimensions of international trade integration -- notably, volume, diversification, and natural resource dependence -- in Sub-Saharan Africa. First, the paper documents the recent trends in these...
| Main Authors: | , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2019
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/222931558366737099/Trade-Integration-and-Growth-Evidence-from-Sub-Saharan-Africa http://hdl.handle.net/10986/31737 |
| Summary: | This paper examines the growth effects
of different dimensions of international trade integration
-- notably, volume, diversification, and natural resource
dependence -- in Sub-Saharan Africa. First, the paper
documents the recent trends in these foreign trade
dimensions for the region and the traditional sources of
growth. Second, it empirically estimates the impact of trade
integration on growth per worker and the sources of growth;
that is, growth of capital per worker and total factor
productivity growth. To accomplish this task, the analysis
uses a sample of non-overlapping five-year period
observations for 173 countries from 1975 to 2014. The
econometric evidence shows that increased trade openness,
greater export production diversification, and reduced
export dependence from natural resources will have a
positive causal impact on economic growth. These effects
will be mainly transmitted through faster capital
accumulation or enhanced total factor productivity growth.
Finally, the paper finds that, despite the progress
exhibited in trade openness and diversification over the
past decade, there are still potential benefits that can be
accrued if countries were to deepen their integration to
world trade. |
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