The Impact of Trade Liberalization on Enterprises in Small Backward Economies: The Case of Chad and Gabon

14 Pages Posted: 15 Jan 2007

See all articles by Giorgio Barba Navaretti

Giorgio Barba Navaretti

University of Milan - Department of Economics, Management and Quantitative Methods (DEMM); University of Milan - Centro Studi Luca d'Agliano (LdA)

Riccardo Faini

Deceased

Bernard Gauthier

HEC Montreal

Abstract

This paper examines the impact of trade and fiscal reforms and of the 1994 devaluation of the CFA franc on enterprise development in Chad and Gabon. These reforms provide a natural experiment to assess the impact of trade liberalization in countries with a small and backward manufacturing sector. The empirical analysis is based on a new panel data base covering virtually the whole population of manufacturing firms in Chad and Gabon, and containing data spanning from the year before to two years after the reforms. The paper finds that although firms response to changing incentives was non-negligible, with a shift of output from nontradable to tradable and an increase in productivity, the reform process was unable to generate a virtuous and self-sustained circle, where export expansion brings a generalized productivity increase which in turn feeds on further export growth.

Suggested Citation

Barba Navaretti, Giorgio and Faini (deceased), Riccardo and Gauthier, Bernard, The Impact of Trade Liberalization on Enterprises in Small Backward Economies: The Case of Chad and Gabon. Review of Development Economics, Vol. 10, No. 3, pp. 452-465, August 2006, Available at SSRN: https://ssrn.com/abstract=920545 or http://dx.doi.org/10.1111/j.1467-9361.2006.00356.x

Giorgio Barba Navaretti (Contact Author)

University of Milan - Department of Economics, Management and Quantitative Methods (DEMM) ( email )

Via Conservatorio, 7
Milan, 20122
Italy
+390250321521 (Phone)

University of Milan - Centro Studi Luca d'Agliano (LdA) ( email )

Via Donizzatti 38
Milano, Mi 20122
Italy
+39 02 36683850 (Phone)

Bernard Gauthier

HEC Montreal ( email )

3000, Chemin de la Côte-Sainte-Catherine
Montreal, Quebec H3T 2A7
Canada
514-340-6809 (Phone)
514-340-6469 (Fax)

HOME PAGE: http://https://www.hec.ca/en/profs/bernard.gauthier.html

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
25
Abstract Views
349
PlumX Metrics