scholarly journals The effect of ASEAN-korea free trade agreement (AKFTA) on Indonesia trade: a gravity model approach

2019 ◽  
Vol 17 (1) ◽  
pp. 1-7
Author(s):  
Arjun Saka Agung ◽  
Zulkarnain Ishak ◽  
Imam Asngari ◽  
Abdul Bashir
Keyword(s):  
Exchange Rate ◽  
Gravity Model ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Gdp Per Capita ◽  
Positive Sign ◽  
Effect Model ◽  
Per Capita ◽  
Model Approach

The aim of this research is to analyze the effect of ASEAN Korea Free Trade Agreement (AKFTA) on Indonesia Trade with gravity model approach using panel data. This research is using Hausman and Chow test to choose the best between the Fixed Effect model (FEM) and Random Effect Model (REM). The test result shows that REM is the best model choosen to analyze the effect from GDP per capita, Exchange rate, distance and AKFTA Policy to the import from 14 AKFTA country economies to Indonesia. The result from R2 shows that the variation of independent variables (GDP per capita, Exchange rate, distance and AKFTA Policies) affected the variation of dependent variable (Import) as 54 percent. Meanwhile, from the gravity theory, the trade among AKFTA economies to Indonesia has bring positive impact as the distance has positive sign and lead to form trade creation. The variable of dummy policy has negative and significantly affected the import.

scholarly journals Finding impact of Pakistan-China Free Trade Agreement (PCFTA) on agricultural exports of Pakistan- Gravity Model Approach

2017 ◽  
Vol 10 (8) ◽  
pp. 81-90 ◽  
Author(s):  
Majid Lateef ◽  
Tong GuangJi ◽  
Muhammad Abdullah ◽  
Mazhir Nadeem Ishaq ◽  
Zeeshan Ahmad ◽  
...  
Keyword(s):  
Gravity Model ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Agricultural Exports ◽  
Model Approach

Free Trade Agreement between Tunisia and the European Union, Do Institutions Matter?: An Empirical Validation by A Gravity Model

2015 ◽  
Vol 5 (2) ◽  
pp. 19-36
Author(s):  
Anis Kacem
Keyword(s):  
European Union ◽  
International Trade ◽  
Gravity Model ◽  
Free Trade ◽  
Spatial Econometrics ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
The European Union ◽  
Institutional Dimension ◽  
North And South

Tunisia has signed a free trade agreement with the European Union in 1996, which provides for the reduction of tariff barriers between Tunisia and the EU. In this article, we aim to know and test whether the similarity of the institutional framework has to stimulate international trade between Tunisia and the European Union. In this context, we built a variable called “Institutional distance” to valid the institutional dimension of international trade, near borders effects reported in the literature. To this end, a gravity model was used initially (Tunisia and 21 European countries). Secondly, the estimate shows the existence of spatial autocorrelation. The latter has been corrected using spatial econometrics. The results show that the geographical distance remains more important than the institutions in this type of agreement between north and south shores of the Mediterranean.

scholarly journals Estimating the Impact of ASEAN China Free Trade Agreement on Indonesia’s Trade Balance

2019 ◽  
Vol 1 (1) ◽  
pp. 18-37
Author(s):  
Muhammad Arif Junaidi
Keyword(s):  
Gravity Model ◽  
Free Trade ◽  
Significant Role ◽  
Trade Balance ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Trade Flows ◽  
Insignificant Effect ◽  
Asean Countries ◽  
The Impact

Using trade flows data of ASEAN countries and China from 2002 to 2017, this studyestimates the impact of ACFTA on ASEAN countries and China’s trade balance in general,and also for Indonesia’s trade balance in specific by elaborating the impact of ACFTA onthe trade flows both exports and imports. Using the gravity model and estimating by OLSand PPML, this paper finds that the impact of tariffs elimination due to the implementationof ACFTA increased exports and imports for ASEAN countries and China in general, andfor Indonesia in particular. However, the aggregate trade balances of ASEAN membercountries and China is zero since the impact of ACFTA on imports offset the impact ofACFTA on exports. Tariff’s elimination due to the implementation of ACFTA on Indonesiashows a negative and statistically insignificant effect on imports and exports. Thus, tariffshave not played significant role on increasing Indonesia’s exports and imports. As a result,the impact of ACFTA on Indonesia’s trade balance cannot be quantified clearly since theimpact of tariffs on exports and imports are not significant.

scholarly journals Recent Experience and Future Prospects of Pakistan’s Trade with China

2009 ◽  
Vol 14 (Special Edition) ◽  
pp. 87-110 ◽  
Author(s):  
Musleh-ud Din Musleh-ud Din ◽  
Ejaz Ghani ◽  
Usman Qadir
Keyword(s):  
Gravity Model ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Bilateral Trade ◽  
Trade Agreement ◽  
Trade Flows ◽  
Recent Experience ◽  
Future Prospects ◽  
Short Term ◽  
Bilateral Trade Flows

This paper examines the prospects of expanding bilateral trade between Pakistan and China particularly in the context of the recently signed free trade agreement between the two countries. Using the augmented gravity model in the tradition of Rose (2004), the paper shows that there is significant potential for the expansion of bilateral trade between the two countries as a result of the free trade agreement. The paper also analyzes bilateral trade flows between the two countries in terms of a trade specialization index and the Grubel-Lloyd index of intra-industry trade. We show that bilateral trade between the two countries is heavily tilted in favor of China and that this situation may persist in the short term.

scholarly journals Internal Trade in Canada

2019 ◽  
Vol 2019 (158) ◽  
Author(s):  
Jorge Alvarez ◽  
Ivo Krznar ◽  
Trevor Tombe
Keyword(s):  
Free Trade Agreement ◽  
Positive Impact ◽  
Trade Agreement ◽  
Gdp Per Capita ◽  
Trade Barriers ◽  
Trade Restrictions ◽  
Per Capita ◽  
Cooperative Solutions ◽  
Productivity Gains ◽  
Internal Trade

This paper assesses the costs of internal trade barriers and proposes policies to improve internal trade. Estimates suggest that complete liberalization of internal trade in goods can increase GDP per capita by about 4 percent and reallocate employment towards provinces that experience large productivity gains from trade. The positive impact highlights the need for federal, provincial and territorial governments to work together to reduce internal trade barriers. There is significant scope to build on the new Canadian Free Trade Agreement to more explicitly identify key trade restrictions, resolve differences, and agree on cooperative solutions.

scholarly journals A Gravity Model of Trade for Nicaraguan Agricultural Exports

2018 ◽  
Vol 37 (74) ◽  
pp. 391-428
Author(s):  
Medardo Aguirre González ◽  
Claudio Candia Campano ◽  
Lilliam Antón López
Keyword(s):  
Gravity Model ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Free Trade Agreements ◽  
Trade Agreement ◽  
Ordinary Least Squares ◽  
Agricultural Exports ◽  
Determining Factors ◽  
Trading Partners ◽  
Gravity Model Of Trade

This research aims to find the determining factors of Nicaraguan agricultural exports. To carry out this study, the author formulated a Gravity Model of Trade (GMT) and then made an estimation using a version of Ordinary Least Squares (OLS) that incorporates a consistent covariance matrix estimator to correct the heteroskedasticity and autocorrelation effects. The data considered observations over twenty years and for twelve countries: eight have signed a Free Trade Agreement (FTA) with Nicaragua and four have not. The variables that significantly increased the flow of Nicaraguan agricultural exports are the following: Nicaragua’s trading partners’ population, Nicaragua’s Gross Domestic Product per capita (GDP pc), the Real Exchange Rate (RER), and Nicaragua’s trading partners’ GDP pc; however, the distance variable turned out to be significantly trade-inhibiting. Free Trade Agreements (FTAs) predominantly have significant effects.

Impact of Globalization on International Trade between ASEAN-5 and China: Opportunities and Challenges

2004 ◽  
Vol 4 (1) ◽  
pp. 1850015 ◽  
Author(s):  
Yunhua Liu ◽  
Hang Luo
Keyword(s):  
International Trade ◽  
Exchange Rate ◽  
Free Trade ◽  
Market Share ◽  
Free Trade Agreement ◽  
Trade Agreement ◽  
Model Based ◽  
Share Model ◽  
Primary Goods ◽  
The Impact

This paper evaluates the impact of China's WTO entry and the establishment of a free-trade agreement between China and ASEAN on the ASEAN-5 (Indonesia, Malaysia, Philippines, Singapore and Thailand). We examine the trade competition between the two regions using a market-share model and assess the impact of China's WTO entry on the ASEAN-5 with an exchange rate-tariff model, based on two-digit SITC data. It is found that for the period 1987 to 2000 the competition in trade only occurred between China and Singapore in manufacturing goods, while the competition between China and other four nations was in primary goods. The trade-widening opportunity between the two regions appears much larger than the competitive challenges for ASEAN-5 after the WTO entry of China and the establishment of FTA between ASEAN and China, impacts on different industries are evaluated.

Developments in India’s Bilateral Trade with ASEAN: A Study in Manufactured Sectors

2014 ◽  
Vol 1 (1) ◽  
Author(s):  
Mayengbam Lalit Singh
Keyword(s):  
Free Trade ◽  
Equilibrium Model ◽  
Free Trade Agreement ◽  
Bilateral Trade ◽  
Trade Agreement ◽  
Partial Equilibrium ◽  
Trade Creation ◽  
Partial Equilibrium Model ◽  
The Impact ◽  
Model Approach

The present paper deals with the impact of the recently signed ASEAN-India Free Trade Agreement (FTA) on manufactured goods. Partial equilibrium model approach (SMART model) has been employed to find out trade creation and diversion values of those goods in respective markets (India as well as ASEAN). In this paper, a new index has been constructed to embody score of India and two ASEAN groups using values of trade creation and diversion.

scholarly journals The Effects of ASEAN-China Free Trade Agreement on Bilateral Trades

2021 ◽  
Vol 56 (2) ◽  
pp. 249-256
Author(s):  
Colin Koh-King Wong ◽  
Venus Khim-Sen Liew ◽  
Mohammad Affendy Arip
Keyword(s):  
Gravity Model ◽  
Free Trade ◽  
Free Trade Agreement ◽  
Bilateral Trade ◽  
Free Trade Area ◽  
Trade Agreement ◽  
Positive Finding ◽  
Trade Area ◽  
Asean Member ◽  
Trading Partners

This article adopts the augmented versions of the Gravity Model to examine the effects of the signing of the ASEAN-China Free Trade Agreement (ACFTA) on the bilateral aggregate trades. Specifically, ACFTA dummy variables are incorporated in the basic model is to estimate the direction and magnitude of the ACFTA effects. A total of 79 trading partners of ASEAN member countries plus China were examined in this article. The study finds that the Gross Domestic Product, population, natural endowment, distance, and common language are the main determining factors of the bilateral trade for ASEAN member countries and their trading partners. Estimated results from this Augmented Gravity Model showed that ACFTA had increased the bilateral aggregate trades not only between intra-bloc member countries but also intra-bloc and extra-bloc countries. With this positive finding, ASEAN and China could consider expanding their free trade area to a broader regional perspective, enhancing economic growth and reducing regional inequality.

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