The Effect of World Bank Trade Adjustment Assistance on Trade and Growth: 1987-2004, Is the Glass Half Full of Half Empty?

Main author: Jinjarak, Yothin
Other authors: Salinas, Gonzalo
Tsikata, Yvonne M.
Format: Journal Article           
Online access: Click here to view record


Summary: This paper studies the association between trade reform, growth, and trade adjustment assistance, in a sample of developing countries that underwent trade reforms during 1987-2004. Our analysis explicitly differentiates between a group of countries that received trade-adjustment loans from the World Bank, and a non-recipient group. The results suggest that trade adjustment assistance is positively associated with economic growth after trade reform in a medium- to long-run. Comparing to a pre-reform period and to the non-recipient group, the recipient countries registered 0.2 percent higher growth of real GDP/capita, 5.0 percent higher import growth, and 2.5 percent higher export growth during a period of three to five years after trade reform.