Breaking into New Markets, Raising Quality, and Improving Services : Neglected Avenues for Export Diversification

Expanding international trade is an important avenue for growth and development in low-income countries. In addition to increasing the quantity of existing export flows, many countries seek to diversify into production and export activities that provide a higher return to the labor and capital resources employed. Export diversity also reduces a country's vulnerability to pronounced price swings in international markets. This note reviews the findings of a series of papers on the diversification process contained in Newfarmer, Shaw, and Walkenhorst (2009). The analysis suggests that there has been too much focus on simply adding new products to export portfolios, which often underscores the use of industrial policies. While such actions are important, a more comprehensive view of diversification, and hence a more comprehensive trade policy, is needed that improves the quality of existing exports, breaks into new geographic markets, and increases services exports.

Bibliographic Details

Main Authors:	Walkenhorst, Peter, Brenton, Paul
Language:	English
Published:	World Bank, Washington, DC 2009-09
Subjects:	BARRIERS TO COMPETITION, BINDING CONSTRAINTS, BUSINESS CLIMATE, BUSINESS ENVIRONMENT, COMPARATIVE ADVANTAGE, COMPETITIVENESS, COSTS OF TRANSPORTATION, CRITICAL MASS, DEVELOPING COUNTRIES, DEVELOPING COUNTRY, DEVELOPMENT ECONOMICS, ECONOMIC DEVELOPMENT, ECONOMIC GROWTH, ECONOMIC RESEARCH, EXPORT GROWTH, EXPORT MARKET, EXPORT MARKETS, EXPORTS, FINANCIAL SECTOR, FOREIGN BUYERS, FOREIGN MARKETS, GDP, GDP PER CAPITA, GEOGRAPHIC DIVERSIFICATION, GLOBAL MARKET, GLOBAL MARKETS, GROWTH POTENTIAL, INCENTIVE STRUCTURE, INCOME, INCOME LEVELS, INFORMATION TECHNOLOGY, INTELLECTUAL PROPERTY, INTERNATIONAL COMPETITIVENESS, INTERNATIONAL MARKETS, INTERNATIONAL TRADE, INVESTMENT POLICIES, LABOR MARKET, LOW-INCOME COUNTRIES, LOW-INCOME COUNTRY, MARKET FAILURES, MARKET PENETRATION, MERCHANDISE, MERCHANDISE EXPORTS, NEW MARKETS, NEW PRODUCTS, OUTSOURCING, PER CAPITA INCOME, PER CAPITA INCOMES, POLICY MAKERS, PORTFOLIO, PORTFOLIOS, PRODUCT DIFFERENTIATION, PRODUCT QUALITY, PRODUCTION COSTS, PRODUCTIVITY, PROPERTY RIGHTS, PUBLIC POLICY, REGULATORY FRAMEWORK, TAX, TECHNOLOGICAL CHANGE, TELECOMMUNICATIONS, TRADE POLICY, TRANSACTION COSTS, TRANSPORT, TRANSPORT COSTS, TRANSPORTATION COSTS, UNCERTAINTIES,
Online Access:	http://documents.worldbank.org/curated/en/2009/09/11361592/breaking-new-markets-raising-quality-improving-services-neglected-avenues-export-diversification https://hdl.handle.net/10986/11109
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