Institutional Quality and Trade Competitiveness in ASEAN Region: Implication for Inclusive and Sustainable Development.

This article investigates the impact of institutional quality on trade competitiveness within the Association of Southeast Asian Nations (ASEAN) using panel data from 2005 to 2020 and a fixed effect econometric model grounded in the revealed symmetric comparative advantage (RSCA) theory. The study finds that improvements in control of corruption, government effectiveness, and political stability significantly enhance trade competitiveness by approximately 33.1%, 92.0%, and 55.0%, respectively, while weak regulatory quality, partial rule of law, and low voice and accountability significantly reduce trade competitiveness by about 25.3%, 95.6%, and 7.6%, respectively. The analysis reveals a one-way causal relationship from institutional quality to trade competitiveness, with no feedback effect observed. Based on these findings, the study recommends that ASEAN governments and citizens strengthen democratic governance, regulatory frameworks, rule of law, and political stability to foster inclusive and sustainable economic growth through enhanced trade competitiveness.