• ISSN: 2010-023X (Print)
    • Abbreviated Title: Int. J. Trade, Economics and Financ.
    • Frequency: Bimonthly
    • DOI: 10.18178/IJTEF
    • Editor-in-Chief: Prof.Tung-Zong (Donald) Chang
    • Executive Editor: Ms. Cherry L. Chen
    • Abstracting/ Indexing:  ProQuest, Crossref, Electronic Journals Library , EBSCO, and Ulrich's Periodicals Directory
    • E-mail: ijtef@ejournal.net
IJTEF 2019 Vol.10(4): 73-84 ISSN: 2010-023X
DOI: 10.18178/ijtef.2019.10.4.641

The Relationship between Export Diversification & Economic Growth: A Comparative Analysis with a Focus on Small Island States

Marlo B. Murphy-Braynen and Ryan M. Thurman
Abstract—This paper examines the relationship between export diversification and economic growth in Small Island Developing States (SIDS), an area for which theory has conflicting views and virtually no empirical research has been undertaken. Empirical evidence shows a significant gap in the export diversification and economic growth experience of SIDS generally, although several small nation states have managed to close the gap with respect to key indicators and successfully evolve from developing to advanced economy status, suggesting that there may be a path by which SIDS can become economically advanced. Utilizing data from 1995 to 2007 for 69 economies segmented by country classification and geography, the empirical results find a non-linear, U-shaped relationship between export concentration and economic growth. This finding is consistent with previous research and robust to different specifications of the growth equation. Further, the study finds that the U-shaped relationship is moderated by the size of the population whereby small nation states, inclusive of small island states, seem to benefit more from export diversification as compared to mid-size and large economies. The findings have noteworthy policy implications for SIDS policymakers seeking to strengthen and improve the diversification, stability and economic growth trajectory of their economies.

Index Terms—Export concentration, export diversification, economic growth, developing economies, advanced economies, Small Island Developing States (SIDS), Small Advanced States (SAS).

M. B. Murphy-Braynen is with the Faculty of Business & Hospitality Management, University of The Bahamas, Nassau, Bahamas (e-mail: marlomurphybraynen@gmail.com) and Bahamas Technical & Vocational Institute, Nassau, Bahamas (email: braynenm@btvi.edu.bs).
R. M. Thurman is with the Department of Mathematics and Statistics, University of South Florida, Tampa, FL 33620 USA (e-mail: rthurman@mail.usf.edu).

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Cite: Marlo B. Murphy-Braynen and Ryan M. Thurman, "The Relationship between Export Diversification & Economic Growth: A Comparative Analysis with a Focus on Small Island States," International Journal of Trade, Economics and Finance vol.10, no.4, pp. 73-84, 2019.

Copyright © 2019 by the authors. This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited (CC BY 4.0).

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