The links between openness and productivity in Mediterranean countries

Cecchini Laurence (1) , Lai-Tong Charles (2)

1 IUFM Lyon - Institut universitaire de formation des maîtres - Académie de Lyon
2 cefi

We examine the relation between the international trade, the foreign direct investment and the total factor productivity of the Mediterranean partner countries of Europe within the framework of a cointegrated panel model. The results, obtained from data on seven Mediterranean partner countries of Europe (Algeria, Egypt, Israel, Jordan, Morocco, Tunisia, Turkey), show that FDI and human capital are complementary in the acquisition of productivity gains. We identify the threshold level of human capital from which the received foreign investments generate beneficial effects. In a more general way, the improvement of the total factor productivity via the international openness results only from the indirect effects related to the transfer of technology.

Mots clés: Social Sciences & Humanities

Cecchini Laurence, Lai-Tong Charles. The links between openness and productivity in Mediterranean countries. Applied Economics, 2008, 40 (06), pp.685-697. ⟨10.1080/00036840600749771⟩. ⟨hal-00582023⟩