Recent trends in trade among developing countries

The paper presents the early results of empirical work on trade among developing countries. The main conclusion is that non-fuel trade among developing countries, excluding capital surplus oil exporters, remained a remarkably stable share of their total trade between 1963 and 1977. This constancy does, however, conceal two interesting opposing trends: The share of manufactures exported to developing countries has been falling sharply, while that of non-fuel primary commodities has been rising, the latter largely because of the demands of the newly industrializing countries. Nevertheless, the dynamism of manufactures has meant that they make up an increasing share of trade among developing countries. Four particular points emerge from the evidence: (i) there is no obvious sign of a bias against trade among developing countries, except whatever effect their own commercial policies may have; (ii) the more inward-looking countries tend to send a higher proportion of their exports to other developing countries and regional integration strengthens this effect; (iii) exports of manufactures to developing countries are much more capital intensive than those to industrialized countries; and (iv) exports to developing country markets may not be the vital first stage for capital goods exports that is sometimes supposed.     

The direction of developing country trade: Empirical evidence of differences between South-South and South-North trade

Declining market opportunities in Northern markets led to views that greater South-South trading might provide an alternative growth stimulus. This paper analyses the characteristics of South-South trade in manufactures and recent changes in the level of such trade to help clarify the potential of greater self-reliance within the South. South-South trade is found to be more intensive in the use of both physical and human capital, hence less rational from the static comparative advantage viewpoint than South-North trade. There is indirect but strong evidence that exporting countries with greatest orientation towards the South are those with greater distortions, less rapid movements up the ladder of comparative advantage, and weaker export performance. Finally, it is observed that the recent boom in South-South trade is largely explained by simple market size effects: very rapid growth of rich oil-exporters and the faster GNP growth of developing compared to developed countries. The paper concludes that while South-South trade of about the present magnitude-one of greater developing country exports - is certainly rational, there is little evidence to support views that greater South-South trade should be especially promoted. Arguments of dynamic comparative advantage may favor South-South trade, but so far these have been more speculative and not yet well researched empirically.     

Is there cause for export optimism? An inquiry into the existence of a second generation of successful exporters

Zusammenfassung Gibt es Anla\ zu Export-Optimismus? — In den sechziger und frühen siebziger Jahren trat die erste Generation von Entwicklungsl?ndern als “neu-industrialisierte” Volkswirtschaften hervor, die ein schnelles Wachstum aufgrund eines Booms von Fertigwarenexporten verzeichneten. Da sich dies bei stark expandierendem Welthandel abspielte, wurde angenommen, da\ die nach 1973 eingetretene Abschw?chung andere L?nder von einer solchen Entwicklung ausschlie\en würde. Wie in diesem Aufsatz gezeigt wird, dehnten aber zwischen 1970 und 1979 ungef?hr zw?lf Entwicklungsl?nder ihre Fertigwarenexporte sogar schneller aus als die neu-industrialisierten L?nder, und zwar bei den gleichen Gütern und auf denselben Auslandsm?rkten. Dies zeigt, da\ eine zweite Generation von L?ndern mit hohen Fertigwarenexporten imstande war, dem Beispiel der neu-industrialisierten Volkswirtschaften trotz ungünstigerer Rahmenbedingungen zu folgen.

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Résumé Y a-t-il des causes pour un optimisme d’exportations? — Pendant les années soixante et les premières années soixante-dix la première génération des pays en voie de développement s’élevait comme économies ?nouvellement industrialisées? qui faisaient l’expérience d’une croissance économique rapide associée avec un flot des exportations manufacturières. Comme ce succès se passait aux environs globaux d’un commerce mondial qui s’étendait considérablement, on a pensé que la récession après 1973 exclurait d’autres pays de suivre la même voie. Les auteurs, cependant, démontrent dans l’article que pendant la période 1970–1979 environ douze pays développants augmentaient leurs exportations manufacturières même plus rapidement que les pays ?nouvellement industrialisés?, et cette expansion se passait dans les mêmes produits et sur les mêmes marchés. Cela démontre qu’une deuxième génération des pays développants était capable de suivre l’expérience des économies ?nouvellement industrialisées? malgré des environs moins réceptifs à la croissance exportatrice.

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Resumen ? Está fundamentado el optimismo basado en las exportaciones ? — En los a?os sesenta y principios de los setenta la primera generación de países en desarrollo emergió como ?nuevas economías industrializadas?, registrando rápidas tasas de crecimiento asociadas con una vigorosa exportación de manufacturas. El hecho de que esto último ocurriera dentro del marco de un comercio internacional fuertemente en expansión, fué la causa de que se pensara, que la floja coyuntura despúes de 1973 evitaría que otros países pudieran seguir la misma pauta. El artículo muestra sin embargo, que en el período 1970–1979 unos doce países incrementaron sus exportaciones de manufacturas incluso más rápidamente de lo que lo hicieran los llamados ?nuevos países industrializados?, y haciéndolo además en los mismos productos y mercados. Esto pone de manifiesto, que a pesar de unas circunstancias no tan favorables para el crecimiento de la exportatión, una segunda generación de exportadores de manufacturas fué capaz de seguir el ejemplo de las nuevas economías industrializadas.

     

TRADE POLICY AND PRODUCTIVITY GAINS IN DEVELOPING COUNTRIES: A Survey of the Literature

Despite the widely accepted view that liberal, outward-orientedtrade policies are superior to restrictive, inward-orientedpolicies, doubts about liberalization remain strong in manycircles. One reason for such doubt is the dearth of researchquantifying the large gains that liberal trade policies aresaid to generate. The survey of the literature undertaken forthis article was a review of the evidence on the link betweentrade policy and efficiency, or productivity, gains in developingcountries. Does the literature support the view that more opentrade policies bring greater efficiency? Several inferencesare drawn from the literature on sources of growth—particularlywith regard to increases in capacity utilization and economiesof scale. The article also examines evidence from the few studiesthat explicitly try to correlate efficiency gains directly withtrade policy. These studies fall into three categories: thosethat evaluate the effect of trade policy on market power ordegree of competition; those that measure total factor productivityor technical efficiency gains and correlate these with the degreeof protection; and those that estimate the aggregate effectsof changes in trade policy on welfare (mainly with computablegeneral equilibrium models, which measure dynamic efficiencygains from trade). In a final section, the article pulls togetherthe findings from the indirect and direct evidence as a basisfor suggesting a number of hypotheses on the link between efficiencyand trade policy. One conclusion is that country-specific analysisover time appears to be superior to cross-country comparisons.