NJIT Economics How Trade Affects Economic Growth Literature Review

Literature Review Also, hundreds of empirical studies on economic growth across countries have highlighted the correlation between economic growth and a variety of variables.Claims regarding the determinants of economic growth are conditional, and the findings depend on the variables used. However, the availability of physical capital or infrastructure, government consumption, terms of trade, macroeconomic stability, the rule of law, regulatory quality, government effectiveness, foreign direct investments, population size, and natural resource availability are the most consistent findings of empirical studies on economic growth. 1. Review the literature on economic growth and provide a summary of how: a) Trade affects economic growth b) Government expenditure affects economic growth.