Search results for "gravity model"

Determinants and efficiency of Pakistan's chemical products' exports: An application of stochastic frontier gravity model.

2019

The estimation of efficiency of industry-specific exports is very important to find exports' gap and to frame exports promotion policy for targeted industry. This study attempts to investigate the main determinants of chemical products' exports of Pakistan with 62 trading partners by applying Stochastic Frontier Analysis (SFA) on an augmented gravity model for a period 1995-2015. The results corroborate that chemical products' exports follow gravity patterns. This study finds a negative and significant impact of import tariff on exports of chemical products while the positive impact of devaluation has been observed. Further, the estimations also take into account the impact of Preferential …

Free Fields for Chiral 2D Dilaton Gravity

1998

We give an explicit canonical transformation which transforms a generic chiral 2D dilaton gravity model into a free field theory.

Rethinking Regional Competitiveness: Catalonia's International and Interregional Trade 1995-2006

2009

Studies of competitiveness tend to focus on a local economy's global interactions, particularly its international trade. But for countries that are at least mid-sized (such as Spain), interregional trade tends to be as large as or significantly larger than international trade. The case of Catalonia illustrates the importance of interregional flows in truly analyzing and devising strategies for a region's external competitiveness. Accounting for interregional trade changes and performing analyses of Catalonia's overall merchandise trade balance, which sectors generate external surpluses as opposed to deficits, and who Catalonia's key trading partners are, and the use of a gravity-model appro…

Does the GATT/WTO promote trade? After all, Rose was right

2019

This paper re-examines the effect of the GATT/WTO on trade using recent econometric developments that allow us estimating structural gravity equations with the Poisson pseudo-maximum likelihood (PPML) estimator on a large dataset that requires computing high-dimensional fixed effects. By doing so, we overcome computational limitations that are present in previous studies. In line with Rose’s (Am Econ Rev 94:98–114, 2004) seminal work, we find that, unlike regional trade agreements and currency unions, the GATT/WTO accession has not generated positive trade effects. This result is robust to the use of alternative measures of trade flows, across periods and country groups, to changes in the p…

How "attractive" is good governance for FDI?

2008

The importance of the Logistics Performance Index in international trade

2014

Logistics and transport increasingly play a pivotal role in international trade relations. The Logistics Performance Index (LPI) analyses differences between countries in terms of customs procedures, logistics costs and the quality of the infrastructure for overland and maritime transport. The aim of this article is to analyse the impact that each of these components has on trade in emerging economies using a gravity model. Furthermore, the study also attempts to detect possible advances in logistics in developing countries, which are grouped into five regions (Africa, South America, Far East, Middle East and Eastern Europe) by comparing the first LPI data published in 2007 with the most re…

EMU and trade: A PPML re‐assessment with intra‐national trade flows

2020

This paper examines the EMU effect on trade for the eleven early joiners and Greece relying for the first time on data that include both international and intra‐national trade flows, in line with all the microfoundations of the structural gravity model of trade. We find that the overall EMU impact on trade is positive between its members and, specially, for trade between members and non‐members. Interestingly, we further show that the effect of the EMU on bilateral trade remarkably differs across countries. For Ireland, Belgium–Luxembourg, Spain, Portugal and Austria, we find robust evidence that EMU has boosted trade both with other members and with third countries, while for Finland, Fran…

TERRORISM AND INTERNATIONAL TOURISM: NEW EVIDENCE

2008

This paper analyses the impact of terrorist activity on international tourist flows. To this end, we have estimated a cross‐sectional gravity equation for tourism from the G‐7 countries to a sample of 134 destinations over the period 2001–2003. Within this framework, we evaluate the deviation from ‘normal’ tourist flows due to terrorist activity, which is considered as negative advertising for the affected country. The analysis suggests that both domestic victims and international attacks are relevant factors when foreign tourists make their choice. This result is robust under alternative specifications. Moreover, the impact of terrorism is more severe in developing countries. The author is…

Trade Costs, Trade Balances, and Current Accounts: an application of Gravity to Multilateral Trade

2005

In this paper we test the well-known hypothesis of Obstfeld and Rogoff (NBER Macroeconomics Annual 7777:339–390, 2000) that trade costs are the key to explaining the so-called Feldstein–Horioka puzzle. Our approach has a number of novel features. First, we focus on the interrelationship between trade costs, the trade account and the Feldstein–Horioka puzzle. Second, we use the gravity model to estimate the effect of trade costs on bilateral trade and, third, we show how bilateral trade can be used to draw inferences about desired trade balances and desired intertemporal trade. Our econometric results provide strong support for the Obstfeld and Rogoff hypothesis and we are also able to recon…

Competitiveness and interregional as well as international trade: The case of Catalonia

2010

Recent years have seen a surge of interest among industrial organization economists in using data on international trade flows as windows into competitiveness. For countries that are at least mid sized (e g., Spain), interregional trade tends to be as large as or significantly larger than international trade. The case of Catalonia, a Spanish region, illustrates how ignoring interregional flows can lead to erroneous inferences about a region's external competitiveness. Accounting for Catalonia's interregional as well as international flows shifts what is generally assessed to be a chronic trade deficit in goods into a surplus and changes diagnoses of which Catalan sectors generate external s…