Economic performance of the OIC countries and the prospect of an islamic common market

Document Type

Article

Publication Date

4-1-2010

Abstract

This paper examines economic performance of the OIC member countries and analyzes the prospect of Islamic common market by analyzing trade data within a gravity model framework. There is scope of trade creation for OIC member countries if all impediments to trade and business can be eliminated. The paper also examines various subregional grouping within the context of gravity model, and finds that D8 comprising eight bigger OIC member countries is trade creating. For example, two countries in D8 block would trade 4.28 times more among themselves than two otherwise-similar country in outside the block would. The paper suggests a number of policy parameters which if followed will lead to more trade among member countries. The issue of Islamic common market should be examined further in light of new data and changed global perspectives. This paper is complements and extends Hassan (1999, 2009) and Hassan and Islam (2001), where similar conclusions were derived and policies were suggested.

Publication Title

Journal of Economic Cooperation and Development

First Page Number

65

Last Page Number

121

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