Export Diversification and the Caribbean Economic Recovery Act. Office of Economic Working Paper, No. 2008-09-E

摘要

One objective of the Caribbean Basin Economic Recovery Act (CBERA) is to encourage economic growth in the Caribbean Basin countries by promoting increased production and exports of non-traditional products, i.e. export diversification. Although the literature on the impact of preferential trade agreements is extensive, studies dealing with export diversification as a result of such agreements are rare. This paper focuses on a potential effect that the CBERA may have had on the diversification of exports from the Caribbean Basin countries to the United States. It addresses the issue of whether export diversification is a result of the CBERA by analyzing data of U.S. imports from CBERA beneficiaries at the 6-digit HTS classification from 1983 to 1999. After controlling for various factors thought to affect diversification, the data analysis and fixed-effects generalized least squares estimation suggest that, although modestly, the CBERA has in fact contributed to the increased diversification in the regions exports to the United States.