EXPORT DIVERSIFICATION AND ECONOMIC GROWTH: EVIDENCE FROM CROSS-COUNTRY ANALYSIS (In case of post-soviet countries)

Abstract

This study examines the influence (effects) of export diversification in economic growth across post-soviet countries. In a sample of seven countries for the period 1997-2019 the dynamic panel estimation reveals that export diversification is important determinant of economic growth, Estimating the impacts of other variables are also important. These variables are: lagged growth, trade openness, investment, Education, Agriculture/GDP ratio, Manufacturing/GDP ratio, Services/GDP ratio, Population growth. It is found that countries with more diversified exports generally experienced faster economic growth. Results of the study indicates that export diversification has an influence on economic growth. A positive relation between export diversification and growth is established and it suggests that countries with a higher rate of export diversification (less
concentration) experience a higher rate of economic growth. Moreover, the results show both export diversification and export growth are robust determinants of growth rates while trade openness is not robust. This suggests that for countries striving to achieve economic growth, export diversification should go along with the growth of its exports