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As of Date, the Most Significant Challenge to the Positive

Question 7

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As of date, the most significant challenge to the positive empirical results linking trade and growth is the issue brought up by Rodriguez and Rodrik, namely that:


A) there is significant correlation between the variables used in past empirical models.
B) statistical non-stationarity issues have cast a doubt on the validity of past empirical findings.
C) international trade variables capture the influences of other omitted variables, such as institutions.
D) past studies only used fast-growing economies that guaranteed a significant trade-growth relationship.

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