Does Free Trade Advance Economic Growth?

I have conducted a survey of journal articles that have examined the relationship between free trade and economic growth. In particular, I have carefully selected six empirical studies that were published over a ten-year period and critically reviewed, and evaluated these studies in depth. I have also extensively presented and discussed the issues as well as the controversies that are related to the various measures of openness. In a number of the trade-growth empirical studies researchers have made major attempt to identify the relationship between free trade and economic growth. Most of the trade-growth studies show that there is a positive relationship between free trade and economic growth. However, some of these influential studies have been subject to strong criticism, mainly due to a number of methodological shortcomings. As for the million-dollar question: Does free trade advance economic growth? My conclusion is that this question is not yet resolved, because although researchers have devoted considerable efforts to show a positive trade-growth relationship, nevertheless, the methodologies and the measurements applied in these studies have been fragile to the scrutiny of critics.

Contents

1 INTRODUCTION
1.1 BACKGROUND
1.2 OBJECTIVE & SCOPE
1.3 METHOD & STRUCTURE
2 THEORETICAL FRAMEWORK
3 BROAD OVERVIEW OF THE LITERATURE
3.1 CROSS-COUNTRY STUDIES VS. CASE STUDIES
3.2 TRADE POLICY INDICATORS, OTHER POLICIES & GROWTH
3.3 OPENNESS MEASUREMENTS
4 CRITICAL EVALUATION OF THE LITERATURE
4.1 EMPIRICAL STUDIES
4.1.1 David Dollar (1992)
4.1.2 Jeffery Sachs and Andrew Warner (1995)
4.1.3 Sebastian Edwards (1998)
4.1.4 Dan Ben-David (1998)
4.1.5 Jeffery A. Frankel and David Romer (1999)
4.1.6 David Dollar and Aart Kraay (2003)
4.2 AREAS OF CONTROVERSY
4.3 IDENTIFIED GAPS & POSSIBLE AVENUES FOR FUTURE RESEARCH
5 CONCLUSION
6 REFERENCES
7 APPENDIX

Author: Kidane, Frewyeni

Source: Uppsala University Library

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Does Free Trade Advance Economic Growth?