Determinants of the Export Function in Morocco: Evidence from ARDL and Dynamic ARDL Models

Abstract

Maintaining an acceptable level of trade deficit is one of the main challenges of the trade policy in developing countries like Morocco. Therefore, studying the most influential factors of the export function is of foremost importance. In this regard, our article studies the impact of a set of supply and demand determinants on export behavior in Morocco for the period Q1-1998–Q4-2018. The study uses an ARDL bound testing approach with structural breaks, extending to a future projection using the dynamic ARDL. The results of this study show that financial development, natural resources, and foreign investment output significantly influence Morocco’s export behavior. Consequently, forging a multidimensional policy that ensures the optimal allocation of financial resources, the modernization of the agricultural and phosphate sectors, and the transfer of know-how from foreign investors are some of the structural recommendations that will allow the promotion of exports in the future.