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Trade and the Rate of Income Convergence

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Author Info
Dan Ben-David
Ayal Kimhi

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Abstract

To the extent that trade policy affects trade flows between countries, the ramifications can be far-reaching from an economic growth perspective. This paper examines one aspect of these ramifications, namely the impact of changes in the extent of trade between countries on changes in the rate of reduction in the size of the income gap that exists between them. Export and import data are used as the criteria for determining bilateral trade between major trade partners, resulting in the creation of 127 pairs of countries on the basis of export data and 134 pairs on the basis of import data. An increase in trade between major trade partners - and in particular, increased exports by poorer countries to their wealthier partners - is shown to be related to an increase in the rate of convergence between the countries.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 7642.

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Date of creation: Apr 2000
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Handle: RePEc:nbr:nberwo:7642

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F1 - International Economics - - Trade
O1 - Economic Development, Technological Change, and Growth - - Economic Development

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References listed on IDEAS
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    Other versions:
  5. Ben-David, Dan, 1996. "Trade and convergence among countries," Journal of International Economics, Elsevier, vol. 40(3-4), pages 279-298, May. [Downloadable!] (restricted)
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  12. Jeffrey D. Sachs & Andrew Warner, 1995. "Economic Reform and the Process of Global Integration," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, vol. 26(1995-1), pages 1-118. [Downloadable!]
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Robert-Nicoud, Frédéric, 2006. "Off-Shoring of Business Services and Deindustrialization: Threat or Opportunity - and for Whom?," CEPR Discussion Papers 5617, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  2. Kari E.O. Alho & Ville Kaitila & Mika Widgrén, 2004. "Speed of Convergence and Relocation: New EU Member Countries Catching up with the Old," Discussion Papers 963, The Research Institute of the Finnish Economy. [Downloadable!]
    Other versions:
  3. Chad Stroomer & David E.A. Giles, 2003. "Income Convergence and trade Openness: Fuzzy Clustering and Time Series Evidence," Econometrics Working Papers 0304, Department of Economics, University of Victoria. [Downloadable!]
  4. Changkyu Choi, 2004. "Foreign direct investment and income convergence," Applied Economics, Taylor and Francis Journals, vol. 36(10), pages 1045-1049, June. [Downloadable!] (restricted)
  5. Frederico Gonzaga Jayme Jr, 2001. "Notes on trade and growth," Textos para Discussão Cedeplar-UFMG td166, Cedeplar, Universidade Federal de Minas Gerais. [Downloadable!]
  6. Eva Jelnikar & Urban Murmayer, 2006. "Convergence in Europe: Empirical Analysis on Two Groups of Countries of the European Union," Papers of the Annual IUE-SUNY Cortland Conference in Economics, in: Proceedings of the Conference on Human and Economic Resources, pages 249-263 Izmir University of Economics. [Downloadable!]
  7. Ana Flávia Machado & Frederico G. Jayme Jr, 2002. "Trade liberalization and labor market in Brazil: impacts on employment and wages in tradeables and nontradeables sectors," Textos para Discussão Cedeplar-UFMG td174, Cedeplar, Universidade Federal de Minas Gerais. [Downloadable!]
  8. David E. A. Giles, 2001. "Output Convergence and International Trade: Time-Series and Fuzzy Clustering Evidence for New Zealand and Her Trading Partners, 1950-1992," Econometrics Working Papers 0102, Department of Economics, University of Victoria. [Downloadable!]
    Other versions:
  9. Joan Costa Font & Eduardo Rodriguez-Oreggia, . "Is the Spanish Stock Market Efficient? An Answer Based on Non-Linear Prediction Methods," Studies on the Spanish Economy 141, FEDEA. [Downloadable!]
  10. Andrea Bassanini & Stefano Scarpetta, 2001. "The Driving Forces of Economic Growth: Panel Data Evidence for the OECD Countries," Post-Print halshs-00168383_v1, HAL. [Downloadable!]
  11. Badinger, Harald & Tondl, Gabriele, 2002. "Trade, human capital and innovation: The engines of European regional growth in the 1990s," ERSA conference papers ersa02p043, European Regional Science Association. [Downloadable!]
  12. Alho, Kari & Kaitila, Ville & Widgrén, Mika, 2008. "Offshoring, Relocation and the Speed of Convergence in the Enlarged European Union," CEPR Discussion Papers 7000, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
  13. Ville Kaitila, 2003. "Convergence of Real GDP per Capita in the EU15 area: How do the Accession Countries Fit in ?," Discussion Papers 865, The Research Institute of the Finnish Economy. [Downloadable!]
  14. Xubei Luo, 2004. "The role of infrastructure investment location in China's western development," Policy Research Working Paper Series 3345, The World Bank. [Downloadable!]
  15. Ville Kaitila, 2004. "Convergence of real GDP per capita in the EU15. How do the Accession Countries fit in?," Economics Working Papers 025, European Network of Economic Policy Research Institutes. [Downloadable!]
  16. Miet Maertens & Liesbeth Colen & Johan F.M. Swinnen, 2008. "Globalization and Poverty in Senegal: A Worst Case Scenario?," LICOS Discussion Papers 21708, LICOS - Centre for Institutions and Economic Performance, K.U.Leuven. [Downloadable!]
  17. Roger Perman & Christophe Tavera, 2005. "A cross-country analysis of the Okun's Law coefficient convergence in Europe," Applied Economics, Taylor and Francis Journals, vol. 37(21), pages 2501-2513, December. [Downloadable!] (restricted)
  18. Ville Kaitila, 2005. "Integration and Conditional Convergence in the Enlarged EU Area," Economics Working Papers 031, European Network of Economic Policy Research Institutes. [Downloadable!]
    Other versions:
  19. Luca De Benedictis & Lucia Tajoli, 2005. "Similarity in export composition and catching-up," Working Papers 28-2005, Macerata University, Department of Finance and Economic Sciences, revised Oct 2008. [Downloadable!]
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