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An anatomy of Nepal’s remarkable export decline: A note

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  • Sharma, Rishi R.

Abstract

This paper documents and breaks down a remarkable decline in Nepal’s exports over the 2000–2019 period. This decline is due to a collapse in the country’s top export products and is largely uniform across destinations and products. Furthermore, it is not on account of the poor global performance of the sectors Nepal was specialized in but is something more specific to Nepal. Industry-level statistics show that gross output increased in major exporting industries while value-added grew slower or declined. The increase in gross output together with the decline in exports implies a movement towards producing for domestic consumption using more imported inputs. These patterns are broadly consistent with the expected effects of the surge in remittances Nepal experienced over this time period. Remittances would cause the economy to transition towards domestic consumption and re-orient domestic production accordingly.

Suggested Citation

  • Sharma, Rishi R., 2023. "An anatomy of Nepal’s remarkable export decline: A note," Journal of Asian Economics, Elsevier, vol. 89(C).
    • Handle: RePEc:eee:asieco:v:89:y:2023:i:c:s1049007823000830
    DOI: 10.1016/j.asieco.2023.101663
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    References listed on IDEAS

    as
    1. Paudel, Ramesh C. & Burke, Paul J., 2015. "Exchange rate policy and export performance in a landlocked developing country: The case of Nepal," Journal of Asian Economics, Elsevier, vol. 38(C), pages 55-63.
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    4. Chandan Sapkota, 2013. "Remittances in Nepal: Boon or Bane?," Journal of Development Studies, Taylor & Francis Journals, vol. 49(10), pages 1316-1331, October.
    5. Gabriel J Felbermayr & Wilhelm Kohler, 2014. "Exploring the Intensive and Extensive Margins of World Trade," World Scientific Book Chapters, in: European Economic Integration, WTO Membership, Immigration and Offshoring, chapter 4, pages 115-148, World Scientific Publishing Co. Pte. Ltd..
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    More about this item

    Keywords

    Nepal; Exports; Remittances;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F24 - International Economics - - International Factor Movements and International Business - - - Remittances
    • O24 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Trade Policy; Factor Movement; Foreign Exchange Policy
    • O25 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Industrial Policy
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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