The Effects of Changes in a Country's Demographics on Trade Flows

Abstract

This paper examines the impact that changing demographics have on the trade flows between countries. Using data from 180 countries and over fifty industries, I estimate the effect that changes in multiple measures of a population’s make-up have on exports, imports, and the ratio between them. My results suggest that an increase in the population growth rate will produce an increase in exports in labor intensive industries, as well as for imports. The primarily reason behind this effect, and other variations is a changing competitive advantage between countries.