Trade Openness, Trade Costs and Growth: why sub-Saharan Africa performs poorly

Abstract

The principal aim of this paper is to identify, in the context of the relationship between openness and growth, factors that can account for the poor growth performance of sub-Saharan African (SSA) countries. It is specifically concerned with variables that have a policy interpretation, especially in relation to trade. After an initial introduction, the contents of this document are as follows: section 2 presents a brief discussion of the data and specifications used in the analysis. Section 3 presents the results for the cross-section, or long-run, relationship. Section 4 extends this analysis with panel estimates to explore the short-run aspects of the relationships. Section 5 concludes with a summary of the main findings and a discussion of the policy implications for African development