Export Diversification and Economic Growth

By Heiko Hesse. 2008

337 citations recorded by the source corpus.

Export diversification can lead to higher growth. Developing countries should diversify their exports since this can, for example, help them to overcome export instability or the negative impact of terms of trade in primary products. The process of economic development is typically a process of structural transformation where countries move from producing 'poor-country goods' to 'rich-country goods.' Export diversification does play an important role in this process. The author also provides robust empirical evidence of a positive effect of export diversification on per capita income growth. This effect is potentially nonlinear with developing countries benefiting from diversifying their exports in contrast to the most advanced countries that perform better with export specialization.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/620dbf4c9a719ff62ff06be6ff1dedbb04e48ec8

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Citations in the corpus

• Can Developing Countries Gain from Defying Comparative Advantage? Distance to Comparative Advantage, Export Diversification and Sophistication, and the Dynamics of Specialization (2018, background): “…has provided evidence that they also bring substantial advantage to developing countries in terms of economic growth (Hausman et al., 2007; Hesse, 2008; Jarreau and Poncet, 2012; Anand et al., 2012; IMF, 2014; Mau, 2016), output stability (Mobarak, 2005; Koren and Tenreyro, 2007; Malik…”
• Export diversification, composition, and economic growth: Evidence from cross-country analysis (2013, methodology): “Diversification of exports can be measured by calculating the concentration indices like Herfindahl index and Hirschman index. In the present analysis, diversification of export basket has been captured using Hirschman’s (1945) commodity concentration index (CCI) as in Michaely (1962). The index is ”