TRADE LIBERALIZATION AND ECONOMIC GROWTH: PANEL ANALYSIS ON THE CASE OF NEW EU MEMBER STATES

Ненад Станишић, Ненад Јанковић, Гордана Миловановић

DOI Number
10.22190/TEME1703673S
First page
673
Last page
685

Abstract


Trade liberalization represents one of the key policies in European transitional economies. In accordance with the classical and neoclassical economic paradigm, despite possible negative effects in the short run, and on the specific segments of the economy, the benefits from trade liberalization are larger to the whole society. The topic of this paper is the contribution of trade liberalization to the economic growth. Panel regression is conducted on the sample of new EU member states with the Index of trade freedom of The Heritage Foundation as a proxy for the level of trade liberalization. The results reveal that the increase of the index of trade freedom is associated with lower (but not higher) real GDP growth rates. The results are robust regarding the period observed.

Keywords

economic growth, trade liberalization, new EU member states, transition.

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References


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DOI: https://doi.org/10.22190/TEME1703673S

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