Changing policies and institutions shape future trade patterns and economic development.
The article explores how different factors like education, finance, and trade policies affect a country's ability to trade with others. By studying trade between 55 developed and emerging economies in various industries, the researchers found that having skilled workers, good financial systems, and favorable business environments are crucial for successful trade. They also discovered that these factors have changed over time due to evolving policies and institutions. The study suggests that having a strong comparative advantage is especially important for trade between different regions, like North-South and South-South trade. Overall, the findings emphasize the need for countries to consider multiple factors when creating economic policies to support trade and development.