Abstract
This paper explores the how international trade and government integrity affect the structural transformation of Lao PDR and Cambodia. This empirical study is conducted by using the methodology based on Chenery-Syrquin model with several control groups that have impacted on structural transformation in Lao PDR and Cambodia. Moreover, the obtained data is from 1993 to 2021 to find out how these two countries transform from being agriculture dominant economy to being more industry-and services-oriented economy. This study has confirmed non-linear effects of both income and population on the sectoral shares and found that trade has facilitated structural transformation in Lao PDR but that didn’t happen in Cambodia. The political corruption index affected the sectional sectors in different ways in Lao PDR and Cambodia, but the results are not statistically significant.
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