The Effect of Import Competition on Ghanaian Manufacturing Firms after Trade Policy Liberalization: 1991-2002

Open Access
Author:
Dawson, William Frederick
Area of Honors:
Economics
Degree:
Bachelor of Arts
Document Type:
Thesis
Thesis Supervisors:
  • James R. Tybout, Thesis Supervisor
  • Russell Paul Chuderewicz, Honors Advisor
Keywords:
  • Economics
  • trade
  • reform
  • liberalization
  • productivity
  • globalization
  • manufacturing
  • imports
  • competition
  • Ghana
Abstract:
Trade policies have shifted dramatically over the last quarter-century in ‘developing’ nations. Economic reforms have been successful in many parts of the world, but some nations have not been able to implement beneficial trade policy reforms. In the 1990s, Ghana liberalized restrictions on imports, lowering tariff rates and eliminating most non-tariff barriers. Trade volumes grew rapidly throughout the latter half of the 1990s and into the 2000s, a time of unprecedented globalization. Using the Regional Program on Enterprise Development (RPED) database and World Trade Organization (WTO) data, I examine the impact of increased import competition on Ghana’s manufacturing sector over the decade from 1992 to 2002. I employ a series of empirical models to estimate the effect of import competition on the output and productivity of domestic firms. Textile and garment producers benefited from increased competition but metal and machine product manufacturers were harmed by import competition.