The impact of governance quality on the industrial export advantage

Hedayat Hatami ¹ ( PhD. Student, Department of Economics, Aligudarz Branch, Islamic Azad University, Aligudarz, Iran )
Kaveh Derakhshani Darabi ² ( Assistant professor in Economics, Arak University; and visiting professor of Islamic Azad University (Corresponding Author), [e-mail] )
Dariush Hassanvand ³ ( Assistant Professor in Economics at Aligudarz branch, Islamc Azad University, Aligudarz, Iran, [e-mail] )

Submited date : 2023-10-02 Accepted date : 2024-02-06

Keywords: F14, Institutional quality, Manufacturing Export, Export Advantage, Transport Logistic. JEL Classification: L90, B52,

Abstract :

The purpose of this study is to identify the affecting factors of the industrial products export advantage with an emphasis on the governance quality. For this purpose, after reviewing the literature and identifying the affecting variables of the export advantage, the relationship between variables is estimated with using the panel data models and data of 82 selected countries in the period of 2007-2018. The results showed that governance quality and the quality of transportation infrastructure had a positive and significant relationship with the industrial products export advantage index. Also, the coefficients of the real exchange rate and foreign direct investment are also positive and significant. Based on the results, institutional quality and good governance through creating a stable environment and reducing costs ultimately lead to improving the export advantage in industrial production. Based on the results, policy stability, transparency of laws and contracts, attention to property rights, as well as decisiveness and speed of contract enforcement are suggested.