Export specialization and economic growth around the world

This paper empirically investigates the extent to which technological characteristics in exports affect the patterns of trade-led economic growth across countries. Data of the Balassa index, which captures a country's revealed comparative advantage, are obtained for industries classified by technological intensity. Regression results based on a sample of 71 countries since 1970 suggest that economies have tended to grow more rapidly when they have increasingly specialized in exporting high-technology as opposed to traditional or low-technology goods. The findings are robust to the presence of various control variables as well as the consideration of parameter heterogeneity and in the endogeneity of export structures.

Research highlights▶ We investigate how technology intensity in exports affects economic growth. ▶ Balassa index data are obtained for industries classified by technological intensity. ▶ Data of 71 countries confirm the growth effect of high-tech export specialization. ▶ Empirical results take into account possible endogeneity and parameter heterogeneity.