What You Export Matters

When local cost discovery generates knowledge spillovers, specialization patterns become partly indeterminate and the mix of goods that a country produces may have important implications for economic growth. We demonstrate this proposition formally and adduce some empirical support for it. We construct an index of the 'income level of a country's exports,' document its properties, and show that it predicts subsequent economic growth.

[1]  D. Rodrik.  What's So Special about China's Exports? , 2006 .

[2]  A. Venables,et al.  The Spatial Economy: Cities, Regions, and International Trade , 1999 .

[3]  Alwyn Young,et al.  Learning by Doing and the Dynamic Effects of International Trade , 1991 .

[4]  Nancy L. Stokey.  Learning by Doing and the Introduction of New Goods , 1988, Journal of Political Economy.

[5]  D. Rodrik,et al.  Economic Development as Self-Discovery , 2002 .

[6]  S. Lall,et al.  The 'Sophistication' Of Exports: A New Measure Of Product Characteristics , 2005 .

[7]  Robin Burgess,et al.  Entry Liberalization and Inequality in Industrial Performance , 2005 .

[8]  M. Michaely.  Trade, income levels, and dependence , 1985 .

[9]  P. Howitt,et al.  Endogenous Growth Theory , 1999 .

[10]  Robert E. Evenson,et al.  Technological change and technology strategy , 1994 .

[11]  Arvind Subramanian,et al.  Addressing the Natural Resource Curse: An Illustration from Nigeria , 2003, SSRN Electronic Journal.

[12]  A. Banerjee,et al.  How Efficiently is Capital Allocated? Evidence from the Knitted Garment Industry in Tirupur , 2004 .

[13]  R. Feenstra,et al.  World Trade Flows: 1962-2000 , 2005 .

[14]  D. Rodrik.  Industrial Policy for the Twenty-First Century , 2004 .

[15]  R. Barro,et al.  Economic Growth, 2nd Edition , 2003 .

[16]  M. Porter.  The Competitive Advantage Of Nations , 1990 .

[17]  G. Ottaviano,et al.  Market Size, Trade, and Productivity , 2005, World Scientific Studies in International Economics.

[18]  Robert E. Evenson,et al.  Chapter 37 Technological change and technology strategy , 1995 .

[19]  G. M. Meier.  Leading issues in economic development , 1971 .

[20]  Kiminori Matsuyama,et al.  Agricultural Productivity, Comparative Advantage and Economic Growth , 1991 .

[21]  P. Krugman,et al.  The Spatial Economy , 1999 .

[22]  A. Banerjee,et al.  Do Firms Want to Borrow More? Testing Credit Constraints Using a Directed Lending Program , 2004 .

[23]  J. Sachs,et al.  Natural Resource Abundance and Economic Growth , 1995 .

[24]  R. Fisman.  Estimating the Value of Political Connections , 2001 .

[25]  Peter K. Schott.  Across-Product Versus Within-Product Specialization in International Trade , 2004 .

[26]  J. Svensson.  Who Must Pay Bribes and How Much? Evidence from a Cross-Section of Firms , 1999 .

[27]  Peter J. Klenow,et al.  The Variety and Quality of a Nation's Exports , 2005 .

[28]  Onathan,et al.  Plants and Productivity in International Trade , 2004 .