There is a large body of research thatexplores international trade as a source of the dispersionin income levels and growth performances across countries.The trade liberalization policies undertaken between 1950and 2006 led to an almost 30 fold growth in the volume ofinternational trade. However this increase has not beenhomogeneous across countries. This study investigates apossible reason that prevents convergence of countries inexport performance. It shows that regulatory quality,customs efficiency, quality of infrastructure, and access tofinance among other factors increase export performance.Furthermore, it shows that countries that are relativelymore constrained in accessing to foreign markets benefitmore from improvements in investment climate than thecountries with easier foreign market access. Hence attaininga favorable investment climate for private sectordevelopment should be an important policy objective forrelatively closed economies to achieve convergence in exportvolumes with countries that have more liberal trade policies.
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