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How Different are demographic impacts on trade openness by geographic region?:Findings from Europe,Asia,America,and Africa

Author

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  • Yukio Fukumoto

    (Department of Economics,Osaka University of Economics)

  • Tomoko Kinugasa

    (Graduate School of Economics, Kobe University)

Abstract

Trade openness and the share of the working-age population vary in different geographic regions of the world, especially, they tend to be high in Europe. Under the hypothesis that the share of the working-age population has a positive effect on trade openness, we clarify the difference of trade openness by region caused by age structure using the panel data for the following four regions in the world: Europe, Asia, America, and Africa. We estimate equations including trade openness as the dependent variable and the share of the working-age population as one of the independent variables based on fixed-effects models and conduct the Blinder-Oaxaca decomposition by region. Our empirical results show that the share of the working-age population has significantly positive effects on trade openness in three regions except Africa. Moreover, high trade openness in Europe compared with Asia or America can be explained by endowment effect of age structure and that compared with Africa can be explained by both endowment and coefficient effects of age structure. Therefore, trade openness is greatly influenced by age structure in Europe, but hardly in Africa.

Suggested Citation

  • Yukio Fukumoto & Tomoko Kinugasa, 2019. "How Different are demographic impacts on trade openness by geographic region?:Findings from Europe,Asia,America,and Africa," Discussion Papers 1912, Graduate School of Economics, Kobe University.
    • Handle: RePEc:koe:wpaper:1912
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