Growth and Convergence in the Asia-Pacific Region: On the Role of Openness, Trade and Migration
NBER Working Paper No. 5276
This paper examines the relationship between openness, trade, and migration in the Asia-Pacific region during the post-1970 period. Conventional reduced-form empirical-growth specifications are augmented by an appeal to structural modelling, an extension that reveals a rich set of interactions between policy, distortions, factor accumulation and growth. A broad array of openness measures play a major role in the successful growth performance of the Asia-Pacific region, a key channel being the distortion-investment nexus. In contrast, the results suggest little role for migration as a quantitatively significant growth determinant, at least at the macro level, which is no surprise in this area of historically low net migration rates. However, I find that within-sample prediction for the Asia-Pacific region is harder to achieve -- 'good luck' as well as 'good policy' played a part.