TRADE OPENNESS AND ECONOMIC COMPETITIVENESS IN DEVELOPING ECONOMIES: A PANEL DATA ANALYSIS WITH POLICY IMPLICATIONS FOR UZBEKISTAN
DOI:
https://doi.org/10.5281/zenodo.22032421Abstract
This article presents the core empirical component of a broader research on trade policy
and economic competitiveness, focusing on the causal relationship between trade policy instruments and
manufacturing competitiveness in developing economies. Using a balanced panel of six countries (China,
Turkey, Indonesia, India, Malaysia, and Vietnam) over 2004–2023 (119 observations), a Fixed Effects model
with White cross-section (period cluster) robust standard errors is estimated, selected over a Random Effects
alternative by the Hausman specification test (χ² = 1025.36, p < 0.001). The robust model explains 91.78% of
the variance in manufacturing value added (F = 120.61, p < 0.001). Trade openness is the strongest positive
determinant (β = 0.098, p < 0.01), while GDP per capita is negatively significant (β = -0.0003, p < 0.01), consistent
with structural transformation theory; tariff rates, FDI inflow, and tertiary school enrollment are statistically
insignificant. Building on these findings and the comparative institutional experiences of China and Turkey, the
article derives policy recommendations for Uzbekistan, emphasizing WTO accession, rationalized (rather than
blanket) tariff protection, efficiency-seeking FDI, and targeted industrial upgrading.
Keywords
trade policy, manufacturing competitiveness, panel data, fixed effects, trade openness, global value chains, UzbekistanReferences
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