Armenia’s trade performance in 1995-2002 and the effect of closed borders: a cross-country perspective

Freinkman, Lev and Polyakov, Evgeny and Revenco, Carolina (2003): Armenia’s trade performance in 1995-2002 and the effect of closed borders: a cross-country perspective. Published in: Armenian Journal of Public Policy , Vol. 2, No. 1 (March 2004): pp. 185-212.

Abstract

The paper deals with two issues. First, it focuses on the analysis of Armenia’s trade performance based on the utilization of standard statistical models and develops comparative estimates of this performance relative to the peer countries. The comparison is undertaken in terms of trade openness, diversification, and composition. The main finding is that Armenia has been lagging in its export development relative to most CIS countries. The recent improvements in exports helped somewhat to reduce the gap. The second part of the paper provides for re-estimation of the “costs of blockade” effect. Armenia’s trade under-performance cannot be explained in terms of distorted government policies, because Armenia is recognized as a reform leader in the CIS.

• Item Type: MPRA Paper
• Language: English
• Keywords: Armenia, trade, costs of blockade, gravity model, trade openness
• Subjects: F - International Economics > F4 - Macroeconomic Aspects of International Trade and Finance > F40 - General; F - International Economics > F1 - Trade > F14 - Empirical Studies of Trade; P - Economic Systems > P2 - Socialist Systems and Transitional Economies > P27 - Performance and Prospects; F - International Economics > F5 - International Relations, National Security, and International Political Economy > F51 - International Conflicts ; Negotiations ; Sanctions

References

Avanesyan, Vahram and Lev Freinkman. 2003. Costing-out the Big Bang: Impact of External Shocks on the Armenian Economy at the Outset of Transition. Armenian Journal of Public Policy 1:1:1-34 (September).

Baldwin, Richard E. 1994. Towards an Integrated Europe. London: Centre for Economic Policy Research.

Beilock, Richard. 2003. Helping the Armenia without Helping the Blockade. Armenian Journal of Public Policy 1:1:79-112 (September).

Belkindas, Misha V. and Olga V. Ivanova. (Eds.) 1995. Foreign Trade Statistics in the USSR and Successor States. Studies of Economies in Transition. Issue 18. World Bank. Washington, DC.

Djankov, Simeon and Caroline Freund. 2002. Trade Flows in the Former Soviet Union. Journal of Comparative Economics 30: 76-90.

Frankel, Jeffrey A. 1997. Regional Trading Blocs in the World Economic System. Institute for International Economics. Washington, DC.

Grubel, Herbert G. and Peter J. Lloyd. 1975. Intra-Industry Trade: The Theory and Measurement of International Trade in Differentiated Products. London: Macmillan.

Hummel, D. 2001. Time as a Trade Barrier. Unpublished Paper. Pardue University. West Lafayette, Ind.

Kaminski, Bartlomiej and Manuel De La Rocha. 2002. “Policy-Induced Integration in Balkans: Policy Options And Their Assessment.” In Trade Policies and Institutions in the Countries of South Eastern Europe on the EU Association and Stabilization Process. The World Bank. Washington, DC. pp. 23-74.

Kaminski, Bartlomiej, Zhen Kun Wang, and Alan Winters. 1996. Foreign Trade in the Transition: The International Environment and Domestic Policy. The World Bank. Washington, DC.

Michalopoulos, Constantine and David Tarr. 1996. Trade Performance and Policy in the New Independent States. The World Bank. Washington, DC.

OECD. 2001. Business Benefits of Trade Facilitation. TD/TC/WP(2001) 21. Paris.

Polyakov, Evgeny. 2001. Changing Trade Patterns after Conflict Resolution in the South Caucasus. Policy Research Working Paper 2593. The World Bank. Washington, DC.

Rodrik, Dani. 1998. Trade Policy and Economic Performance in Sub-Saharan Africa. NBER Working Paper 6562. Cambridge, MA.

Smarzynska, Beata K. 2001. Does Relative Location Matter for Bilateral Trade Flows? An Extension of the Gravity Model. Journal of Economic Integration 16: 3 (September). 23

Tarr, David G. 1994. The Terms of Trade Effects of Moving to World Prices on Countries of the Former Soviet Union. Journal of Comparative Economics 18: 1-24.

World Bank. 2001. Armenia: Growth Challenges and Government Policies. Report No. 22854-AM (in two volumes), Washington, DC.

World Bank. 2002. Armenia Trade Diagnostic Study. Washington, DC. June.

World Bank. 2003a. Armenia: Public Expenditure Review. Washington, DC.

World Bank. 2003b. Trade Performance and Regional Integration of the CIS Countries. Washington, DC. September.

World Bank. 2003c. Global Economic Prospects 2004: Realizing Promise of the Doha Agenda. Washington, DC.