Exports and Economic Growth: Some Additional Evidence

An assessment of the role of exports in economic growth is of obvious importance. At the theoretical level, extremely diverse positions can be taken. For instance, the standard neoclassical trade argument would postulate a substantial positive impact of exports and trade on economic performance due to better allocation of resources. In addition, the "two-gap" models of development would suggest an important positive role of exports in economic development due to an attenuation of the foreign resource "gap." However, the Marxist or the neoMarxist stances may treat trade as one mechanism for exploitation of the less developed countries (LDCs) by the industrialized West. Although further theoretical insights would be valuable, empirical analyses of the issue are needed as well for a better understanding of the relationship between exports and growth. Several recent studies have attempted such an empirical analysis. Michaely considered a sample of 41 LDCs and related the mean annual growth of per capita GNP with the mean annual increase in the share of exports in GNP for the period 1950-73. His method was mainly that of simple correlation. For the entire sample, the rank correlation coefficient between the two variables is .38, which indicates a positive association between the rates of growth of per capita GNP and export share. The association is much stronger for 23 countries with a per capita GNP of $300 or more in 1972 than for others, which led Michaely to infer that exports help "only once countries achieve some minimum level of development."' Also, no positive association was found between the level of the share of exports and per capita income growth. In the context of a study of the impact of foreign trade regimes on economic development, Krueger assessed the effect of exports on