International Integration and Growth: A Survey and Empirical Investigation

Abstract

The authors attempt a comprehensive assessment of different forms of international integration on growth. In particular, the paper considers the impact of trade flows, of inward foreign direct investment, of preferential treatment of less-developed countries, and of membership in trade blocs. Results confirm that general openness and foreign direct investment into a country do lead to increased growth; that membership in a trade bloc facilitates growth; and that the variation in income in the trade bloc also encourages more rapid growth among member countries.

International Integration and Growth: A Further Investigation on Developing Countries

“…Total trade as share of GDP is the first broad measure included in the model. As mentioned in Haveman et al [2001], using such a broad measure of openness, one could unreasonably assume that exports and imports are equally important in determining a country's income growth, and that the source and destination countries do not matter.…”

“…8 Types of trade agreements considered here: (1) preferential trade agreements (PTA), the loosest type of trade agreements, where the tariff level is reduced among partners but not necessarily eliminated; (2) free trade areas (FTA) where tariffs and other restrictions removed between members, however, each country maintains her own tariffs with nonmembers; and (3) custom unions (CU) where members remove trade barriers among themselves (as in FTAs) while set a level of trade barriers (common external tariffs and other common restrictions) against non-member countries. 9 See Haveman et al [2001]. 10 Optimally, the GLS random-effects estimation technique could be used that fully exploits the variation in the data.…”

“…12 See Summers and Heston [1991] for a description. 13 More details (year of agreement, member countries, and possible dissolution) about the regional integration schemes under investigation can be found in the Appendix of Haveman et al [2001].…”

“…Finally, Haveman et al [2001] consider the impact of different avenues of international interactions, and aspects of trade arrangements on the growth rate of income of 74 countries, developing as well as developed, over the period 1970Y1989. Their findings support that general openness, foreign direct investment, and membership in a trade bloc facilitate growth, the variation in income across member countries matters, and trade bloc size does not play any role in determining a country's growth rate.…”

Trading for SDGs: Trade Liberalization and Human Development in the Emerging Economies

“…Most of the studies focused on identifying the impact of trade on economic growth, poverty, and inequality. A positive association between trade and economic growth has been identified by a number of empirical studies (Dollar, 1992;Berg and Schmidt, 1994;Sachs and Warner, 1995;Harrison, 1996;Edwards, 1997;Edwards, 1998;Haveman et al, 2001;Sohn and Lee, 2010;Sun and Heshmati, 2010;Nannicini and Billmeier, 2011;Chilosi and Federico, 2013;Zeren and Ari, 2013;Jouini, 2014;Kuo et al, 2014;Sungming, 2014;Hystad and Jensen, 2015;Prabhakar et al, 2015;Were, 2015;Greaney and Karacaovali, 2016;Manwaa and Wijeweerab, 2016;Silberberger and Koniger, 2016;Sokolovmladenovic et al, 2017;Zahonogo, 2017).…”