Export diversification is one of the key strategies for reducing economic dependence, enhancing resilience to external shocks, and achieving sustainable growth in developing countries. This study aims to examine the effect of export diversification on economic growth in two groups of oil-exporting and non-oil developing countries over the period 2008–2023. The Theil index is used to measure export diversification, and a dynamic panel data model estimated by the System Generalized Method of Moments (System GMM) is employed to analyze the relationship among variables. In addition, trade openness, foreign direct investment, and energy consumption are included in the model as control variables.
The results indicate that export diversification has a positive and statistically significant effect on economic growth in both groups of countries; however, this effect is stronger in non-oil countries than in oil-exporting ones. In other words, reducing export concentration and moving toward a more diversified export basket plays a more effective role in promoting economic growth in non-oil countries, whereas in oil-exporting countries, dependence on natural resources limits the full benefits of export diversification. Moreover, trade openness, foreign direct investment, and energy consumption all exert positive and significant effects on economic growth in both groups, although the magnitude of these effects differs between them. Overall, the findings suggest that export diversification, particularly in non-oil economies, is an important determinant of economic growth and can provide a basis for designing trade and development policies in developing countries.