Narrow Your Choices

Refine By Countries

Refine By Topic

Refine By Series

Refine By Language

Refine By Date

—

Refine By IMF Taxonomy

Refine By JEL Taxonomy

Refine by LOC Taxonomy

Refine By THEMA Taxonomy

  • Print
  • Save

Browse

You are looking at 1 - 1 of 1 items for :

  • Type: Journal Issue x
  • IMF Working Papers x
  • Cross-cutting issues x
  • Cross country analysis x
  • Education: General x
  • New Zealand x
  • Commercial policy x
  • National Government Expenditures and Related Policies: General x
  • Public finance & taxation x
  • Middle East and Central Asia x
  • Fiscal sector x
  • Trade Policy; International Trade Organizations x
  • 'Panel Data Models; Spatio-temporal Models' x
Clear All Modify Search
Cover IMF Working Papers
Trade Openness and Growth: Pursuing Empirical Glasnost
Mr. Andreas Billmeier and Tommaso Nannicini
Studies of the impact of trade openness on growth are based either on cross-country analysis-which lacks transparency-or case studies-which lack statistical rigor. We apply transparent econometric methods drawn from the treatment evaluation literature to make the comparison between treated (i.e., open) and control (i.e., closed) countries explicit while remaining within a unified statistical framework. First, matching estimators highlight the rather far-fetched country comparisons underlying common cross-country results. When appropriately restricting the sample, we confirm a positive and significant effect of openness on growth. Second, we apply synthetic control methods-which account for endogeneity due to unobservable heterogeneity-to countries that liberalized their trade regime and we show that trade liberalization has often had a positive effect on growth.
Keywords:
WP; control country; area dummy; country comparison; trade policy; trade openness; growth; matching estimators; synthetic control; country match; standard error; a lot of country; state monopoly; unobservable country heterogeneity; economic growth; MCD country; Latin American country; unobservable characteristic; Population growth; Trade liberalization; Public expenditure review; Middle East; Africa