Exports and industrial growth: a new framework and evidence

Surveys the literature on the role of exports in economic growth and provides additional qualifications concerning the measurement of the different channels through which exports may contribute to economic growth. Our framework shows that the most commonly used supply‐side approaches have typically underestimated the contribution of exports to economic growth. Using the proposed generalized version of the sources‐of‐growth approach, measures the contribution of exports to the growth of output in the US manufacturing sector and the 20 two‐digit industries. Separates growth of total output into growth attributable to changes in both export‐related and non‐export‐related factor inputs as well as the “residual” or otherwise unexplained growth. For the nation as a whole, over the period of the study, 1971‐1987, finds that export‐related inputs contributed 45.5 per cent to the growth of US output of manufactures, while technology and non‐export‐related inputs contributed 45.4 per cent and 9.1 per cent respectively, significant disparities existing among the industries.