Trade Liberalization and Economic Growth: The Role of Regulatory Policies

Peter K. Biwott; Eliud D. Moyi; Dickson Khainga

doi:doi:10.11648/j.jwer.20130203.13

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Trade Liberalization and Economic Growth: The Role of Regulatory Policies

Peter K. Biwott, Eliud D. Moyi, Dickson Khainga

Published in Journal of World Economic Research (Volume 2, Issue 3)

Received: 10 June 2013 Published: 10 July 2013

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Abstract

This paper investigates the relationship between international tradeliberalization and economic growth with a focus on the role of regulatorypolicies in a selected sample of sixteen sub-Saharan Africa (SSA) countries.While international trade liberalization refers to the removal ofbarriers to international trade, regulatory policies refer to the improvement ofcredit, labour and product markets in a country. Using panel data, the study applies the Instrumental Variables (IV) and the Generalized Method of Moments (GMM)methodologies to deal with the problem of endogeneity. The results show thatbetter regulatory policies significantly contribute to economic growth.Further, international trade liberalization works well when regulatory policiesare improved in tandem with liberalization. Thisimplies that less regulated countries benefit more from international tradeliberalization than heavily regulated countries. Therefore, improvements in policies that regulate credit, labour and product markets willenhance the gains from international trade liberalization in Sub-Saharan Africa. Further, the results show that accumulation of physical capital contributes to economic growth. Thus, Sub-Saharan African countries should reform their regulatory policies as they continue to deepen international trade liberalization.

Published in	Journal of World Economic Research (Volume 2, Issue 3)
DOI	10.11648/j.jwer.20130203.13
Page(s)	45-57
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2013. Published by Science Publishing Group

Keywords

Economic Growth, International Trade Liberalization, Regulatory Policies

References

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APA Style

Peter K. Biwott, Eliud D. Moyi, Dickson Khainga. (2013). Trade Liberalization and Economic Growth: The Role of Regulatory Policies. Journal of World Economic Research, 2(3), 45-57. https://doi.org/10.11648/j.jwer.20130203.13

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ACS Style

Peter K. Biwott; Eliud D. Moyi; Dickson Khainga. Trade Liberalization and Economic Growth: The Role of Regulatory Policies. J. World Econ. Res. 2013, 2(3), 45-57. doi: 10.11648/j.jwer.20130203.13

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AMA Style

Peter K. Biwott, Eliud D. Moyi, Dickson Khainga. Trade Liberalization and Economic Growth: The Role of Regulatory Policies. J World Econ Res. 2013;2(3):45-57. doi: 10.11648/j.jwer.20130203.13

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@article{10.11648/j.jwer.20130203.13,
  author = {Peter K. Biwott and Eliud D. Moyi and Dickson Khainga},
  title = {Trade Liberalization and Economic Growth: The Role of Regulatory Policies},
  journal = {Journal of World Economic Research},
  volume = {2},
  number = {3},
  pages = {45-57},
  doi = {10.11648/j.jwer.20130203.13},
  url = {https://doi.org/10.11648/j.jwer.20130203.13},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jwer.20130203.13},
  abstract = {This paper investigates the relationship between international tradeliberalization and economic growth with a focus on the role of regulatorypolicies in a selected sample of sixteen sub-Saharan Africa (SSA) countries.While international trade liberalization refers to the removal ofbarriers to international trade, regulatory policies refer to the improvement ofcredit, labour and product markets in a country. Using panel data, the study applies the Instrumental Variables (IV) and the Generalized Method of Moments (GMM)methodologies to deal with the problem of endogeneity. The results show thatbetter regulatory policies significantly contribute to economic growth.Further, international trade liberalization works well when regulatory policiesare improved in tandem with liberalization. Thisimplies that less regulated countries benefit more from international tradeliberalization than heavily regulated countries. Therefore, improvements in policies that regulate credit, labour and product markets willenhance the gains from international trade liberalization in Sub-Saharan Africa. Further, the results show that accumulation of physical capital contributes to economic growth. Thus, Sub-Saharan African countries should reform their regulatory policies as they continue to deepen international trade liberalization.},
 year = {2013}
}

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TY  - JOUR
T1  - Trade Liberalization and Economic Growth: The Role of Regulatory Policies
AU  - Peter K. Biwott
AU  - Eliud D. Moyi
AU  - Dickson Khainga
Y1  - 2013/07/10
PY  - 2013
N1  - https://doi.org/10.11648/j.jwer.20130203.13
DO  - 10.11648/j.jwer.20130203.13
T2  - Journal of World Economic Research
JF  - Journal of World Economic Research
JO  - Journal of World Economic Research
SP  - 45
EP  - 57
PB  - Science Publishing Group
SN  - 2328-7748
UR  - https://doi.org/10.11648/j.jwer.20130203.13
AB  - This paper investigates the relationship between international tradeliberalization and economic growth with a focus on the role of regulatorypolicies in a selected sample of sixteen sub-Saharan Africa (SSA) countries.While international trade liberalization refers to the removal ofbarriers to international trade, regulatory policies refer to the improvement ofcredit, labour and product markets in a country. Using panel data, the study applies the Instrumental Variables (IV) and the Generalized Method of Moments (GMM)methodologies to deal with the problem of endogeneity. The results show thatbetter regulatory policies significantly contribute to economic growth.Further, international trade liberalization works well when regulatory policiesare improved in tandem with liberalization. Thisimplies that less regulated countries benefit more from international tradeliberalization than heavily regulated countries. Therefore, improvements in policies that regulate credit, labour and product markets willenhance the gains from international trade liberalization in Sub-Saharan Africa. Further, the results show that accumulation of physical capital contributes to economic growth. Thus, Sub-Saharan African countries should reform their regulatory policies as they continue to deepen international trade liberalization.
VL  - 2
IS  - 3
ER  -

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Author Information

Peter K. Biwott

Planning, Research and Policy Department, Kerio Valley Development Authority, Eldoret, Kenya
Eliud D. Moyi

Macroeconomics Divisions, Kenya Institute for Public Policy Research and Analysis (KIPPRA), Nairobi, Kenya
Dickson Khainga

Macroeconomics Divisions, Kenya Institute for Public Policy Research and Analysis (KIPPRA), Nairobi, Kenya

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APA Style

Peter K. Biwott, Eliud D. Moyi, Dickson Khainga. (2013). Trade Liberalization and Economic Growth: The Role of Regulatory Policies. Journal of World Economic Research, 2(3), 45-57. https://doi.org/10.11648/j.jwer.20130203.13

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ACS Style

Peter K. Biwott; Eliud D. Moyi; Dickson Khainga. Trade Liberalization and Economic Growth: The Role of Regulatory Policies. J. World Econ. Res. 2013, 2(3), 45-57. doi: 10.11648/j.jwer.20130203.13

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AMA Style

Peter K. Biwott, Eliud D. Moyi, Dickson Khainga. Trade Liberalization and Economic Growth: The Role of Regulatory Policies. J World Econ Res. 2013;2(3):45-57. doi: 10.11648/j.jwer.20130203.13

Copy | Download

@article{10.11648/j.jwer.20130203.13,
  author = {Peter K. Biwott and Eliud D. Moyi and Dickson Khainga},
  title = {Trade Liberalization and Economic Growth: The Role of Regulatory Policies},
  journal = {Journal of World Economic Research},
  volume = {2},
  number = {3},
  pages = {45-57},
  doi = {10.11648/j.jwer.20130203.13},
  url = {https://doi.org/10.11648/j.jwer.20130203.13},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jwer.20130203.13},
  abstract = {This paper investigates the relationship between international tradeliberalization and economic growth with a focus on the role of regulatorypolicies in a selected sample of sixteen sub-Saharan Africa (SSA) countries.While international trade liberalization refers to the removal ofbarriers to international trade, regulatory policies refer to the improvement ofcredit, labour and product markets in a country. Using panel data, the study applies the Instrumental Variables (IV) and the Generalized Method of Moments (GMM)methodologies to deal with the problem of endogeneity. The results show thatbetter regulatory policies significantly contribute to economic growth.Further, international trade liberalization works well when regulatory policiesare improved in tandem with liberalization. Thisimplies that less regulated countries benefit more from international tradeliberalization than heavily regulated countries. Therefore, improvements in policies that regulate credit, labour and product markets willenhance the gains from international trade liberalization in Sub-Saharan Africa. Further, the results show that accumulation of physical capital contributes to economic growth. Thus, Sub-Saharan African countries should reform their regulatory policies as they continue to deepen international trade liberalization.},
 year = {2013}
}

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TY  - JOUR
T1  - Trade Liberalization and Economic Growth: The Role of Regulatory Policies
AU  - Peter K. Biwott
AU  - Eliud D. Moyi
AU  - Dickson Khainga
Y1  - 2013/07/10
PY  - 2013
N1  - https://doi.org/10.11648/j.jwer.20130203.13
DO  - 10.11648/j.jwer.20130203.13
T2  - Journal of World Economic Research
JF  - Journal of World Economic Research
JO  - Journal of World Economic Research
SP  - 45
EP  - 57
PB  - Science Publishing Group
SN  - 2328-7748
UR  - https://doi.org/10.11648/j.jwer.20130203.13
AB  - This paper investigates the relationship between international tradeliberalization and economic growth with a focus on the role of regulatorypolicies in a selected sample of sixteen sub-Saharan Africa (SSA) countries.While international trade liberalization refers to the removal ofbarriers to international trade, regulatory policies refer to the improvement ofcredit, labour and product markets in a country. Using panel data, the study applies the Instrumental Variables (IV) and the Generalized Method of Moments (GMM)methodologies to deal with the problem of endogeneity. The results show thatbetter regulatory policies significantly contribute to economic growth.Further, international trade liberalization works well when regulatory policiesare improved in tandem with liberalization. Thisimplies that less regulated countries benefit more from international tradeliberalization than heavily regulated countries. Therefore, improvements in policies that regulate credit, labour and product markets willenhance the gains from international trade liberalization in Sub-Saharan Africa. Further, the results show that accumulation of physical capital contributes to economic growth. Thus, Sub-Saharan African countries should reform their regulatory policies as they continue to deepen international trade liberalization.
VL  - 2
IS  - 3
ER  -

Copy | Download