New measure shows trade openness boosts economic growth worldwide.
Trade openness can impact economic growth, and this study looks at a new way to measure this relationship. By analyzing data from 182 countries between 1971 and 2011, researchers found that using a new measure of trade openness that considers the country's trade size compared to the world trade can provide more accurate results. The study used a statistical method called the Common Correlated Effects Mean Group (CCEMG) estimator to analyze the data and found a significant link between trade openness and economic growth.