Countries’ openness to trade

Abstract

There is the growing number of empiric researches where authors seek to analyse the openness of country to trade. Open country for the trade of goods is characterized by the absence of man-made barriers against the cross-border flows of goods. The opening of domestic market to external countries ensures the better allocation of resources and promotes the orientation of investments to potential exporting sectors, which previously traded in domestic countries mainly. The study aims to propose new model, which can be used for the comparison of countries and their openness to trade. The practical evidence of the model is also provided herein.