Economies in Transition

How Does Export Promotion Facilitate Grow that Intensive and Extensive Margins

Abstract

The primary goal of this paper is the empirical assessment of the effects proceeded from exports on the economic growth of transition economies from both extensive and intensive margins. Preferred estimation methods are Granger causality test and panel regression/cointegration estimators. The study found that fostering export-oriented growth policy triggers technological progress/productivity increase through spillover effects attached to international trade (intensive growth). On the other hand, increasing trade volume/exports stimulate capital accumulation and simultaneously enhances the demand for imported capital and intermediate goods that further complements capital accumulation (extensive growth).
Keywords: intensive growth, extensive growth, export, total factor productivity, capital accumulation