Title: The nexus between finance and manufactured exports in selected Caribbean and Central American countries

Authors: Rajen Mookerjee; Evelyn Wamboye

Addresses: Department of Economics, Pennsylvania State University, Monaca PA 15061, USA ' Department of Economics, Pennsylvania State University, DuBois, PA 15801, USA

Abstract: This study uncovers several surprising and unexpected policy insights that can help small Caribbean and Central American countries develop a strategy to diversify their export base. The results from causality tests of the nexus between financial development and manufactured exports, show that in 63% of a sample of eight countries, financial development causes manufactured exports and vice versa for the remaining 37%. These results are then used to explore in greater depth potential economy specific structural factors that explain the causality test findings in these countries.

Keywords: financial development; Granger causality; manufactured exports; Caribbean; Central America; diversification.

DOI: 10.1504/IJTGM.2014.067281

International Journal of Trade and Global Markets, 2014 Vol.7 No.4, pp.339 - 359

Published online: 02 Feb 2015 *

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