Concentration, diversification and earnings instability: some evidence on developing countries' exports of manufactures and primary products

Love, J. (1983) Concentration, diversification and earnings instability: some evidence on developing countries' exports of manufactures and primary products. World Development, 11(9), pp. 787-793. (doi: 10.1016/0305-750X(83)90091-8)

Abstract

Policies aimed at diversification of the commodity composition of exports continue to be advocated as a means of reducing instability in LDCs' export earnings. The usual assumptions are that earnings from manufactures are more stable than earnings from primary products and that diversification will reduce the covariances between earnings from different pairs of products. It is suggested here that for several reasons these assumptions may not be valid. Evidence is then presented which indicates that across a sample of countries diversification has taken place but has not been accompanied by relatively greater stability in manufactures and favourable changes in covariances.

• Item Type: Articles
• Status: Published
• Refereed: Yes
• Glasgow Author(s) Enlighten ID: Love, Professor James
• Authors: Love, J.
• College/School: College of Social Sciences > Adam Smith Business School
• Journal Name: World Development
• ISSN: 0305-750X