Duration of the Membership in the World Trade Organization and Aid for Trade Flows

Recently, Lee et al. (2015 (The World Economy, 38, 2015 and 1462) have found that developing countries members of the World Trade Organization (WTO) received higher Aid for Trade (AfT) flows than non-WTO developing members. The present paper extends this analysis by investigating the effect of the duration of WTO membership (and not the mere membership in the WTO) on the amounts of AfT flows that accrue to recipient countries. The main argument in the analysis is that the duration of WTO membership matters more than the mere WTO membership for AfT recipient countries' degree of liberalization of trade regime and participation in international trade, the latter being a critical determinant of the AfT flows supplied by donors. The analysis has used a panel dataset of 136 countries over the period from 2002 to 2019, and the two-step generalized methods of moments estimator. It has established that countries receive higher AfT flows as their membership duration increases, and the amounts of these resource inflows increase as recipient countries further liberalize their trade regime and further participate in international trade. Additionally, the effect of the duration of WTO membership on total AfT flows depends on donor-countries' commercial self-interest in recipient countries, including the latter's economic growth performance and endowment in natural resources.