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Does the WTO Increase Trade and Cause Convergence?

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  • Justin Paul

Abstract

China and India implemented the World Trade Organization (WTO) agreements, removing restrictions with the intent to increase international trade and foreign investment. This article aims to examine whether this objective was achieved by analyzing trends in exports and imports, and determining Granger Causality among FDI, exports, and imports during the pre- and post-WTO periods. Our results show that India's imports have more than doubled throughout the post-WTO period, indicating substantial WTO effectiveness in India, while the WTO's effect in China is mixed and not that significant. Further, four theoretical propositions have been posited to encourage further research.

Suggested Citation

  • Justin Paul, 2015. "Does the WTO Increase Trade and Cause Convergence?," The International Trade Journal, Taylor & Francis Journals, vol. 29(4), pages 291-308, October.
    • Handle: RePEc:taf:uitjxx:v:29:y:2015:i:4:p:291-308
    DOI: 10.1080/08853908.2015.1053632
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    Cited by:

    1. Shakib, Mohammed & Sohag, Kazi & Hassan, M. Kabir & Vasilyeva, Rogneda, 2023. "Finance and export diversifications Nexus in Russian regions: Role of trade globalization and regional potential," Emerging Markets Review, Elsevier, vol. 57(C).
    2. Paul, Justin & Shrivatava, Archana, 2016. "Do young managers in a developing country have stronger entrepreneurial intentions? Theory and debate," International Business Review, Elsevier, vol. 25(6), pages 1197-1210.
    3. Shah, Mumtaz Hussain, 2017. "The Significance of WTO’s Trade Related Investment Measures (TRIMs) Agreement For Inward FDI in Sub-Saharan Africa," MPRA Paper 82009, University Library of Munich, Germany.
    4. Shah, Mumtaz Hussain, 2016. "The Effect of Macroeconomic Stability on Inward FDI in African Developing Countries," MPRA Paper 82014, University Library of Munich, Germany.
    5. Francisco Liñán & Justin Paul & Alain Fayolle, 2020. "SMEs and entrepreneurship in the era of globalization: advances and theoretical approaches," Small Business Economics, Springer, vol. 55(3), pages 695-703, October.
    6. Justin Paul, 2016. "The Rise of China: What, When, Where, and Why?," The International Trade Journal, Taylor & Francis Journals, vol. 30(3), pages 207-222, May.
    7. Paul, Justin, 2020. "SCOPE framework for SMEs: A new theoretical lens for success and internationalization," European Management Journal, Elsevier, vol. 38(2), pages 219-230.
    8. Paul, Justin & Feliciano-Cestero, María M., 2021. "Five decades of research on foreign direct investment by MNEs: An overview and research agenda," Journal of Business Research, Elsevier, vol. 124(C), pages 800-812.
    9. Mohammed Shakib, 2023. "Innovation-Export Diversification Nexus in Russian Regions: Does Trade Globalization, Business Potential and Geopolitics Matter?," Journal of Applied Economic Research, Graduate School of Economics and Management, Ural Federal University, vol. 22(4), pages 932-974.

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