Nonlinearity between Trade Openness and Economic Development

Dong-Hyeon Kim, Shu Chin Lin, Yu Bo Suen

Research output: Contribution to journalArticle

15 Citations (Scopus)

Abstract

This paper utilizes the instrumental variable threshold regressions approach to reassess the trade-development link. It finds evidence that trade openness contributes to uneven development. Greater trade openness tends to have beneficial effects on real development of high-income countries. For low-income ones, however, trade openness appears to influence real income in a significant and negative way. The data also reveal that greater trade openness has a positive effect on capital accumulation, productivity growth, and financial development in high-income countries, but a negative impact in low-income ones.

Original languageEnglish
Pages (from-to)279-292
Number of pages14
JournalReview of Development Economics
Volume15
Issue number2
DOIs
Publication statusPublished - 2011 May 1
Externally publishedYes

Fingerprint

nonlinearity
economic development
income
economics
low income
capital accumulation
uneven development
productivity
regression
trade openness
trade (economic)
evidence
effect

ASJC Scopus subject areas

  • Geography, Planning and Development
  • Development

Cite this

Nonlinearity between Trade Openness and Economic Development. / Kim, Dong-Hyeon; Lin, Shu Chin; Suen, Yu Bo.

In: Review of Development Economics, Vol. 15, No. 2, 01.05.2011, p. 279-292.

Research output: Contribution to journalArticle

Kim, Dong-Hyeon ; Lin, Shu Chin ; Suen, Yu Bo. / Nonlinearity between Trade Openness and Economic Development. In: Review of Development Economics. 2011 ; Vol. 15, No. 2. pp. 279-292.
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