Archive of Journal - Financing

Financing – scientific magazine for economy

ISSUE 2023, No. 2, Article 3, Year of publication: 14, June, 2023
Impact of trade opennes on economic growth: evidence from post-socialist economies

AUTHORS

Siniša Kurteš, PhD*; Srđan Amidžić, PhD**; Drago Kurušić***

*PhD Associate Professor, University of Banja Luka, Faculty of Economics, Department for Economic Theory, Analysis and Policy,  **PhD Associate Professor, University of Banja Luka, Faculty of Economics, Department for Economic Theory, Analysis and Policy,  ***Elite Fair d.o.o. Banja Luka

ABSTRACT

ARTICLE INFO

Today, trade openness is positioned as one of the most frequently used determinants of economic growth. Small transitional economies that were forced to compete on the world market after the collapse of the socialist system had more or less success in their economic development. Integration into the world market, institutional and non-institutional, has led to a large level of openness of these economies towards foreign trade, primarily imports. Today, most transition countries are more open to imports than to exports, while they are increasingly open to foreign exchange. Therefore, as the subject of this research, we consider the impact of trade openness as a determinant of economic growth in 50 post-socialist countries. The observation period included in the research is the period from 2000 to 2019. In the research, we apply the ARDL model proposed by Pesaran (1997) and Pesaran & Shin (1999) in order to show the impact of trade openness on the economic growth of post-socialist countries. The goal of the research is to quantify the impact of trade openness in the long and short term on the economic growth of the observed countries. The results of the panel model that we applied in the research testify to the existence of a positive influence of trade openness on the economic growth of post-socialist countries in the long and short term with a high level of significance of the calculated coefficients.

Keywords: trade openness, economic growth, economic development, export

DOI: 10.7251/FIN2302027K

drago.kurusic@elitefairbl.com