CEPII, Recherche et Expertise sur l'economie mondiale
Growth-enhancing Effect of Openness to Trade and Migrations: What is the Effective Transmission Channel for Africa


Dramane Coulibaly
Blaise Gnimassoun
Valérie Mignon

 Highlights :
  • We investigate the growth-enhancing effect of openness to trade and to migration in Africa.
  • We show a varying impact of openness for Africa depending on the type of the partner country.
  • Only trade between Africa and industrialized countries has a clear and robust positive impact on Africa's standards of living, operating through an improvement in total factor productivity.

 Abstract :
This paper investigates the growth-enhancing effect of openness to trade and to migration by focusing on African countries. Relying on robust estimation techniques dealing with both endogeneity and omitted variables issues, our results show a varying impact of openness for Africa depending on the type of the partner country. Specifically, while trade between Africa and industrialized countries has a clear and robust positive impact on Africa's standards of living, trade with developing countries fails to be growth-enhancing. Moreover, our findings show that migration has no significant effect on per capita income in Africa regardless of the partner. Finally, exploring the trade openness transmission channel, we establish that the growth-enhancing effect of Africa's trade with industrialized countries mainly occurs through an improvement in total factor productivity.

 Keywords : Trade | International migration | Income per person | Africa

 JEL : F22, F4, O4, O55
CEPII Working Paper
N°2016-25, November 2016

 Expertise
Emerging Countries
Trade & Globalization
Migrations

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