from Middle and Low Income Developing Countries

Abstract: The paper explore the relationship between trade liberalization and poverty in a sample of 107 low income developing countries by applying correlation and regression analysis technique on the data from 1980-2010. Our investigation established the fact that the relationship of trade liberalization and poverty in sample of low income developing countries is different across the different income groups. Correlation analysis reveals that Openness and Poverty has significant relationship in the low income developing countries, while this relationship is insignificant in the sample of lower middle income and upper middle income countries. It leads us to the conclusion that this relationship varies across different income groups. Further regression analysis established that the role of openness is partially significant in poverty reduction in our sample. But these results differ according to the income groups of sample. Only upper middle income countries are more benefitted from this trade openness while in rest of two income groups openness has no role in poverty reduction