Asia-Pacific Research and Training Network on Trade Working Paper Series 106
This paper explores the relationship between manufacturing and growth rate in recent years. We undertake a simple cross-country analysis using UN data. When controlling for variables relevant to growth, we find no significant relationship between the two variables. We argue that manufacturing protectionism cannot be rationalized by the data for this time period. Then, we look at developed countries like the United States and find that whereas a positive relationship between 10 year forward GDP growth and manufacturing was likely present in the 1970's, the same relationship does not hold today. Our findings shed light on recent debates over protectionism.