International Business Management

Year: 2016
Volume: 10
Issue: 6
Page No. 878 - 890

The Impact of Weighted Comparative Advantage of the Nine Exports Industries and Exports Diversification on Economic Growth of Selected Developing Countries in West Asia

Authors : Afsaneh Shayesteh and Homayoun Ranjbar

Abstract: Developmental plans of the country emphasize on the exports-focused growth strategy and export diversification is one of the most appropriate policies in this area. Export diversification can serve as an important lever for production growth if it moves from primary goods to products with high skill and high-tech industrial goods; on the other hand, it is necessary to note that the comparative advantage in the production and export of goods is one of the effective factors in understanding the manufacturing and exports capabilities of a country to adopt appropriate policies in this field, based on the results of this research, the average impact of the weighted comparative advantage of the nine industries has been negative and significant on economic growth. Also, the effect of exports diversification has been positive and significant on economic growth of the countries studied. Overall, the findings of this research relies on the fact that these countries have had a static comparative advantage in the period under study and exports diversification have been carried out only on the industry with advantage that means the industry code 35 (oil and petrochemical industry) in the group of developing countries in West Asia. In order to increase the industrial exports to compete in the international economy and achieve higher economic growth, the countries under investigation should have a strategic sight to the physical and human capital and creation of the comparative advantage. Therefore, the present study attempts to review and evaluate the effect of comparative advantage and export diversification on the economic growth according to the selected developing countries’ nine industries in West Asia by using the method of panel data for the period of 1998-2013.

How to cite this article:

Afsaneh Shayesteh and Homayoun Ranjbar, 2016. The Impact of Weighted Comparative Advantage of the Nine Exports Industries and Exports Diversification on Economic Growth of Selected Developing Countries in West Asia. International Business Management, 10: 878-890.

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