Study On Impact Of Trade To Economic Growth In Mongolia

The relationship between foreign trade and economic growth has always been the focus of the theory study. With economic globalization, economic growth is inseparable from the study of international trade. According to some theories, trade may play an important role in promoting economic growth. Trade may promote resources configuration on a global scale. It is important for every country to develop trade with each other.Mongolia began to democratize from the year of1990. It was from then on that the nation started to open up to the world. In1997, Mongolia joined the World Trade Organization. In2009, the number of Mongolia’s trade partners reached118. The rapid development of Mongolia’s trade may contribute a lot to its economic. Mongolia’s economy has also realized rapid growth in recent years.Currently, little literatures have covered study of the relationship between Mongolia’s foreign trade and economic growth. Most studies were made simply from the point of view of the economic growth in Mongolia. This article will analyze the relationship between Mongolia’s foreign trade and economic growth by new methods. On this basis, this paper has two innovation points, one is to study the issue of Mongolian, another is to use new ways of study.At the beginning, the paper reviewed some relative theories and research on the relationship between trade and economic growth. Then, using the methods of cointegration analysis, Granger causality test and ADF test methods, the paper did an empirical test based on the data of Mongolia. What’s more, additional studies are made in the basis of trade structure and degree of opening in Mongolia. According to the result of test, trade plays an important role in promoting economic growth in Mongolia. Besides, mineral resources are the main driving factors of trade and economic growth in Mongolia.Finally, according to the conclusions several policy suggestions are made aiming at promote the growth of trade in Mongolia.