Effect of Poverty on Services Export Concentration in Developing Countries

This paper investigates the effect of poverty on services export concentration in developing countries. The analysis has used an unbalanced panel dataset of 95 developing countries over the period 1995–2014. Findings suggest that higher poverty rates induce greater services export concentration, and this effect translates through three channels, namely, human capital, trade openness, and export product concentration. Thus, if they were to diversify services export items, policymakers should implement policies (such as reducing services trade barriers and improving the business environment) that directly promote services export diversification, but also measures that directly target poor segments of the population.