Trade Openness and Developing Countries’ Vulnerability: Concepts, Misconceptions, and Directions for Research

SummaryThis work focuses on the welfare costs of exposure to shocks and uncertainty linked to trade openness—a prominent issue in international debate. It contributes by presenting a comprehensive review of the literature on the “destabilizing effects” of trade openness, drawing together studies in different fields. It provides a conceptualization of vulnerability and three promising lines of reasoning (macro, micro, and meso) for future research on the link between trade and vulnerability.