Institutions and Trade: Competitors or Complements in Economic Development?

13 Pages Posted: 8 Oct 2009

See all articles by Sambit Bhattacharyya

Sambit Bhattacharyya

Australian National University

Steve Dowrick

Australian National University (ANU) - Faculty of Economics & Commerce

Jane Golley

Australian National University (ANU) - Faculty of Economics & Commerce; Australian National University (ANU) - Crawford School of Public Policy

Abstract

This article contributes to the debate over the empirical relationship between trade openness and economic development. Unlike previous studies which treat trade openness and institutions as competitors in economic development, we find evidence that they are in fact complements. We also find that in order for a country to benefit from trade, its institutional quality has to be above a certain threshold level. These results are suggestive of an important complementary role for trade openness and institutions in economic development.

Suggested Citation

Bhattacharyya, Sambit and Dowrick, Steve and Golley, Jane, Institutions and Trade: Competitors or Complements in Economic Development?. Economic Record, Vol. 85, Issue 3, pp. 318-330, September 2009, Available at SSRN: https://ssrn.com/abstract=1484283 or http://dx.doi.org/10.1111/j.1475-4932.2009.00541.x

Sambit Bhattacharyya (Contact Author)

Australian National University ( email )

HW Arndt Building, ANU
Canberra, Australian Capital Territory 2601
Australia

HOME PAGE: http://www.ecocomm.anu.edu.au/people/info.asp?Surname=Bhattacharyya&Firstname=Sambit

Steve Dowrick

Australian National University (ANU) - Faculty of Economics & Commerce ( email )

Building 26
Canberra ACT 0200
Australia

Jane Golley

Australian National University (ANU) - Faculty of Economics & Commerce ( email )

Canberra, Australian Capital Territory 2601
Australia

Australian National University (ANU) - Crawford School of Public Policy

ANU College of Asia and the Pacific
J.G. Crawford Building, #132, Lennox Crossing
Canberra, Australian Capital Territory 0200
Australia

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