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N° 2009-04 |
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| March 2009 |
The Trade-Growth Nexus in the Developing Countries:
a Quantile Regression Approach |
Gilles Dufrénot
Valérie Mignon
Charalambos Tsangarides |
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| This paper applies quantile regression techniques to investigate how the impact of trade
openness on the growth rate of per capita income varies with the conditional distribution of
growth. Using formal robustness analyses, we first identify robust variables affecting
economic growth (investment, government balance, terms of trade, inflation, and population
growth) which we then use as controls in the quantile regression estimations. Our findings
suggest a heterogeneous trade-growth nexus: for both the long-run and the short-run, the
effect of openness on growth is higher in countries with low growth rates compared to those
of high growth rates. Our results cast doubt on earlier literature that finds little effect of
openness on growth, and suggest that the implications of parameter heterogeneity in the
openness-growth relationship need to be considered before prescribing policies. |
Non-technical summary  |
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Résumé
non-technique
en français |
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| Full text |
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| Quantile regression; growth-trade nexus; developing countries |
Keywords |
| C23; F13; O11 |
JEL classification |
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