Inclusive economic growth and international trade in Peru 2000-2021

Abstract

Introduction/Purpose: Inclusive economic growth is a concept that has taken on importance in recent years globally; however, it has scarcely been studied in Peru. This research aims to know if there exists a positive relationship between inclusive economic growth and international trade in Peru in the period 2000-2021. Methodology: Inclusive economic growth was measured using the pillars of growth and development (per capita GDP, labour productivity, employment, and life expectancy) and inclusion (income concentration and poverty) of the Inclusive Development Index (IDI) proposed by the World Economic Forum. The Ordinary Least Squares (OLS) method was used to perform the regressions. Findings: The results show that the growth of International Trade in Peru has a positive relationship with two of the indicators of inclusive economic growth analysed: real GDP per capita and Vulnerable Employment. In contrast, it has a negative relationship with Labour Productivity. There is no statistical significance for the Poverty variable. Furthermore, there is no cointegration between Peruvian International Trade and Life Expectancy at Birth or Income Distribution. Conclusions: Therefore, it is concluded that inclusive economic growth has a positive relationship with Peruvian International Trade. The study focuses on four development pillars and two inclusion pillars, so the analysis will serve to propose policies that promote inclusive economic growth in Peru.