Table 2: Random effects regressions for growth volatility, openness, and product diversification<sup>_†_</sup>

||**Direct**<br>(_R1_)|(_R2_)|**Product di**<br>(_R3_)|**versifcation**<br>(_R4_)|(_R5_)|
|---|---|---|---|---|---|
|Product||-12.179|-6.732|-5.660|-1.209|
|Diversifcation||(4.85)<sup>_∗∗_</sup>|(3.69)<sup>_∗_</sup>|(3.77)|(0.64)<sup>_∗_</sup>|
|Trade|2.564|0.016|-2.664|-3.086|3.098|
|openness|(1.31)<sup>_∗_</sup>|(1.25)|(2.10)|(2.50)|(1.56)<sup>_∗∗_</sup>|
|Openness _×_||15.779|9.223|8.084|1.658|
|diversifcation||(5.98)<sup>_∗∗∗_</sup>|(4.55)<sup>_∗∗_</sup>|(4.62)<sup>_∗_</sup>|(0.79)<sup>_∗∗_</sup>|
|Financial|-0.157|-0.166|-0.153|-0.149|-0.152|
|openness|(0.08)<sup>_∗∗_</sup>|(0.07)<sup>_∗∗_</sup>|(0.07)<sup>_∗∗_</sup>|(0.07)<sup>_∗∗_</sup>|(0.07)<sup>_∗∗_</sup>|
|Terms of trade|0.052|0.043|0.041|0.040|0.040|
|volatility|(0.02)<sup>_∗∗∗_</sup>|(0.02)<sup>_∗∗_</sup>|(0.02)<sup>_∗_</sup>|(0.02)<sup>_∗_</sup>|(0.02)<sup>_∗_</sup>|
|Exchange rate|0.000|0.000|0.000|0.000|0.000|
|volatility|(0.00)|(0.00)|(0.00)|(0.00)|(0.00)|
|Capital fows|0.807|0.739|0.750|0.746|0.745|
|volatility|(0.19)<sup>_∗∗∗_</sup>|(0.16)<sup>_∗∗∗_</sup>|(0.16)<sup>_∗∗∗_</sup>|(0.16)<sup>_∗∗∗_</sup>|(0.16)<sup>_∗∗∗_</sup>|
|Foreign growth|0.729|0.790|0.778|0.781|0.784|
|volatility|(0.37)<sup>_∗∗_</sup>|(0.37)<sup>_∗∗_</sup>|(0.38)<sup>_∗∗_</sup>|(0.38)<sup>_∗∗_</sup>|(0.37)<sup>_∗∗_</sup>|
|Infation|0.008|0.008|0.008|0.008|0.008|
|volatility|(0.01)|(0.01)|(0.01)|(0.01)|(0.01)|
|Banking crisis|5.169|5.056|4.946|4.976|4.961|
||(2.33)<sup>_∗∗_</sup>|(2.34)<sup>_∗∗_</sup>|(2.34)<sup>_∗∗_</sup>|(2.34)<sup>_∗∗_</sup>|(2.34)<sup>_∗∗_</sup>|
|R<sup>2</sup>|0.255|0.274|0.275|0.273|0.275|
|F|3758.8<sup>_∗∗∗_</sup>|4781.0<sup>_∗∗∗_</sup>|4817.7<sup>_∗∗∗_</sup>|4974.4<sup>_∗∗∗_</sup>|4934.5<sup>_∗∗∗_</sup>|
|N|380|378|378|378|378|
||||**Market div**|**ersifcation**||
|||(_R6_)|(_R7_)|(_R8_)|(_R9_)|
|Product||-14.591|-10.731|-14.297|-1.290|
|Diversifcation||(7.93)<sup>_∗_</sup>|(7.30)|(8.90)|(0.76)<sup>_∗_</sup>|
|Trade||-0.304|-5.529|-10.495|3.783|
|openness||(1.85)|(5.66)|(8.60)|(1.62)<sup>_∗∗_</sup>|
|Openness _×_||18.974|13.250|17.368|1.633|
|diversifcation||(10.56)<sup>_∗_</sup>|(9.53)|(11.62)|(1.00)|
|Financial||-0.173|-0.183|-0.186|-0.182|
|openness||(0.07)<sup>_∗∗_</sup>|(0.08)<sup>_∗∗_</sup>|(0.08)<sup>_∗∗_</sup>|(0.08)<sup>_∗∗_</sup>|
|Terms of trade||0.048|0.051|0.052|0.050|
|volatility||(0.02)<sup>_∗∗_</sup>|(0.02)<sup>_∗∗_</sup>|(0.02)<sup>_∗∗_</sup>|(0.02)<sup>_∗∗_</sup>|
|Exchange rate||0.000|0.000|0.000|0.000|
|volatility||(0.00)|(0.00)|(0.00)|(0.00)|
|Capitalfows||0.784|0.824|0.835|0.814|
|<br>volatility||(0.18)<sup>_∗∗∗_</sup>|(0.18)<sup>_∗∗∗_</sup>|(0.19)<sup>_∗∗∗_</sup>|(0.18)<sup>_∗∗∗_</sup>|
|Foreign growth||0.799|0.803|0.801|0.805|
|volatility||(0.38)<sup>_∗∗_</sup>|(0.37)<sup>_∗∗_</sup>|(0.37)<sup>_∗∗_</sup>|(0.37)<sup>_∗∗_</sup>|
|Infation||0.007|0.006|0.006|0.006|
|volatility||(0.01)|(0.01)|(0.01)|(0.01)|
|Crisisdummy||5.256|5.042|5.069|5.128|
|||(2.44)<sup>_∗∗_</sup>|(2.40)<sup>_∗∗_</sup>|(2.39)<sup>_∗∗_</sup>|(2.42)<sup>_∗∗_</sup>|
|R<sup>2</sup>||0.253|0.246|0.247|0.249|
|F||3959.0<sup>_∗∗∗_</sup>|3810.1<sup>_∗∗∗_</sup>|3939.3<sup>_∗∗∗_</sup>|3931.6<sup>_∗∗∗_</sup>|
|N||364|364|364|364|

> _†_ Notes: Huber-White (robust) standard errors reported in parentheses. _∗_ indicates significance at 10 percent level,<sup>_∗∗_</sup> indicates significance at the 5 percent level, and<sup>_∗∗∗_</sup> indicates significance at the 1 percent level. Period dummies and a constant were included, but not reported.

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