scholarly journals Regional Integration in South Asia: An Analysis of Trade Flows Using the Gravity Model

2010 ◽  
Vol 49 (2) ◽  
pp. 105-118 ◽  
Author(s):  
Naseem Akhter ◽  
Ejaz Ghani
Keyword(s):  
Gravity Model ◽  
Regional Integration ◽  
Bilateral Trade ◽  
Trade Agreement ◽  
Jel Classification ◽  
Trade Flows ◽  
Regional Trade ◽  
Trade Effect ◽  
Bilateral Trade Flows ◽  
Trade Potential

The study deals with trade benefits from the free trade agreement of the SAARC countries. It assesses the trade potential and trade creation with member and non-member countries. The gravity model has been used to measure the bilateral trade flows and to assess the trade effect for member and non-member countries. Two analyses estimate the gravity model. The first analysis is based on crosssectional data to capture the trade effect individually each year; and the second analysisutilises the pooled data to measure the overall trade effects and trade flows for the period 2003 to 2008. The results from the two approaches show that estimated coefficients are consistent with the model assumptions. Both analyses show that the regional trade agreement of the SAARC countries could divert the trade for member countries as well as for the non-member countries. However, trade volume will increase only if the major partners (Pakistan, India, and Sri Lanka) sign regional trade agreements. JEL classification: F15 Keywords: Trade; Regional Integration; Gravity Model

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 Determinants of Bilateral Trade Flows Between Vietnam and Trading Partner Countries – Gravity Model Approach

2021 ◽  
Vol Volume II (December 2021) ◽  
pp. 128-142
Author(s):  
Le Khuong Ninh ◽  
Phan Anh Tu ◽  
Pham Thi Nhu Hao
Keyword(s):  
Gravity Model ◽  
Bilateral Trade ◽  
Trade Openness ◽  
Trade Agreement ◽  
Trade Flows ◽  
Population Exchange ◽  
Economic Distance ◽  
Trading Partners ◽  
Bilateral Trade Flows ◽  
Convergence Method

This study uses the gravity model to investigate the bilateral trade flows between Vietnam and 52 countries from 2001 through 2011. The data are collected from International Trade Centre (ITC), International Monetary Fund (IMF), and the World Bank (WB). The results show that economic size, geographical distance, economic distance, technological innovation, trade openness, free trade agreement, population, exchange rate, and common border affect the bilateral trade flows between Vietnam and these 52 countries. More importantly, this study uses the speed-of-convergence method to find new potential trading partners for Vietnam, such as those in Africa and Southwest Asia.

scholarly journals The Gravity Model Approach: An Application on the Eco Was Trading Bloc

2016 ◽  
Vol 11 (1) ◽  
pp. 67-75 ◽  
Author(s):  
Afolabi O. Luqman ◽  
Nor Aznin Abu Bakar ◽  
Azman Aziz Mukhriz Izraf
Keyword(s):  
Gravity Model ◽  
Bilateral Trade ◽  
Strong Relationship ◽  
Trade Flows ◽  
Gravity Models ◽  
Trade Integration ◽  
Regional Trade ◽  
Trading Bloc ◽  
Bilateral Trade Flows ◽  
Model Approach

Abstract This study aims to examine bilateral trade flows across ECOWAS-15 nations with the use of a panel and cross section for the period of 1981-2013. The methodology carried out to achieve this objective involves the use of various techniques of estimation for the gravity model (Static and dynamic). More specifically, this study aims to investigate the formational impact of regional trade integration agreements on trade flows within a group of countries using the same currencies and ECOWAS at large. The main use of regional variables into gravity models is intended to determine whether RTAs lead to trade creation, or diversion. The results show the presence of a strong relationship among the factors of both RIAs and trade flows.

scholarly journals The Formation of AFTA and Trade Diversion: Evidence from China’s Agricultural Exports

2016 ◽  
Vol 17 (1) ◽  
pp. 25-36
Author(s):  
Nguyen Khanh Doanh ◽  
Jeehoon Lee ◽  
Yoon Heo
Keyword(s):  
Panel Data ◽  
Free Trade Agreement ◽  
Bilateral Trade ◽  
Trade Agreement ◽  
Trade Diversion ◽  
Trade Flows ◽  
Agricultural Products ◽  
Agricultural Exports ◽  
Trading Partners ◽  
Bilateral Trade Flows

This study analyzes the impacts of the formation of AFTA (ASEAN Free Trade Agreement) on China’s agricultural exports. The Hausman-Taylor analysis is applied to panel data collected from China and its 68 trading partners from 1993–2012. Our major findings areas follows. First, the discrimination in tariffs imposed by AFTA diverts trade in agricultural products from China toward AFTA’s member countries. Second, at the sectoral level, the trade diversion effects of AFTA’s formation on China’s exports are significant in the case of beverage and tobacco industries. AFTA and China need to focus more on diversifying and differentiating their farming products. To gain better access to AFTA’s market, more investment in research and development activities is recommended as a cure for Chinese farmers. Moreover, this study implies that more efforts in reducing tariff and non-tariff barriers to further liberalize trade between China and AFTA could enhance their bilateral trade flows.

scholarly journals The Trade Effect of the EU’s Preference Margins and Non-Tariff Barriers

2020 ◽  
Vol 13 (9) ◽  
pp. 203
Author(s):  
Maria Cipollina ◽  
Federica Demaria
Keyword(s):  
Developing Countries ◽  
Bilateral Trade ◽  
Developed Countries ◽  
International Markets ◽  
Trade Flows ◽  
Preferential Trade ◽  
Trade Effect ◽  
Bilateral Trade Flows ◽  
The Developed Countries ◽  
The Impact

Nowadays, trade negotiations afford both liberalism- and protectionism-oriented policies. Indeed, in recent decades, the developed countries have been actively engaged in negotiating many preferential agreements to integrate developing countries (DCs) into world trade and encourage their economic growth, but many of these schemes contrast with the complex rules, often imposed on international markets, that still are an obstacle for exporters. Their presence and related costs reduce the importance of preferential trade agreements (PTAs) in increasing trade flows. This article attempts to assess the impact of preferential trade policies on trade flows controlling for different non-tariff barriers (NTBs), using a structural gravity model. The analysis uses disaggregated data, registered in the year 2017, on EU imports (defined at level HS-6 digit) from a large number of exporters (187 developed and developing countries) and also includes the intra-EU trade. Our results show robust and positive estimates for the impact of preferences on bilateral trade flows, however, higher non-tariff barriers are likely to play a role in reducing both the extensive margins of trade, and so tariff preferences alone are not sufficient to access international markets. The impact of NTBs on the intensive margin of trade is ambiguous; some measures may act as catalysts and therefore increase trade, and others may act as an additional cost of trade and thus hinder trade.

scholarly journals International trade and endogenous standards: the case of GMO regulations

2012 ◽  
Vol 11 (3) ◽  
pp. 415-437 ◽  
Author(s):  
MAURO VIGANI ◽  
VALENTINA RAIMONDI ◽  
ALESSANDRO OLPER
Keyword(s):  
International Trade ◽  
Gravity Model ◽  
Bilateral Trade ◽  
Composite Index ◽  
Trade Flows ◽  
Agricultural Products ◽  
Approval Process ◽  
Bilateral Trade Flows ◽  
Gmo Regulation ◽  
Bilateral Differences

AbstractThis paper quantifies the effect of GMO regulation on bilateral trade flows of agricultural products. We develop a composite index of GMO regulations and using a gravity model we show that bilateral differences in GMO regulation negatively affect trade flows. This effect is especially driven by labeling, approval process, and traceability. Our results are robust to the endogeneity of GMO standards to trade flows.

scholarly journals INSTITUTIONS AND INTRA-REGIONAL TRADE IN CEFTA 2006: A GRAVITY APPROACH

2019 ◽  
Vol 1 (17) ◽  
pp. 11
Author(s):  
Łukasz Klimczak ◽  
Jelena Trivić
Keyword(s):  
Free Trade ◽  
Bilateral Trade ◽  
Free Trade Agreements ◽  
Trade Agreements ◽  
Trade Flows ◽  
Positive Sign ◽  
Regional Trade ◽  
Bilateral Trade Flows ◽  
The Impact

The purpose of this paper is to identify factors that had an influence on bilateral trade flows among the CEFTA countries with special emphasize: 1) on the role of CEFTA agreement and its preceding network of bilateral free trade agreements, and 2) on the role of institutions in facilitating intra-regional trade. In order to assess the impact of these variables on trade, we employed an augmented gravity model based on panel data of the CEFTA countries in fifteen years period (2000-2014). The results of the research suggest that there was a positive and statistically significant role of the CEFTA agreement on trade between its parties but the influence of the preceding bilateral free trade agreements was even higher. Results also showed that institutions can play an important role as trade facilitators, but mainly in the importing country while in the exporting country only three of six variables showed to have a positive sign.

scholarly journals Intra-ECO Trade: A Potential Region for Pakistan’s Future Trade

2006 ◽  
Vol 45 (3) ◽  
pp. 425-437 ◽  
Author(s):  
Jahangir Khan Achakzai
Keyword(s):  
Gravity Model ◽  
Regional Integration ◽  
Gravity Equation ◽  
Trade Flows ◽  
Regional Trade ◽  
Potential Region ◽  
Trade Preferences

A standard gravity model was applied to estimate the magnitude of potential trade flows between Pakistan and the nine ECO member countries. The major issue in this analysis is to explore that Intra- ECO trade has great potential for Pakistan and that it got lower share than its potential. The results from the gravity model confirm that ECO has a positive and significant impact on intra-regional trade. It suggests that intra-regional trade is lower than what would be predicted by the gravity equation, suggesting greater scope for regional integration among the ECO member countries. This is especially the case between countries that have a common geographical border. The privilege of geography and the existence of trade preferences among ECO members could be expanded to cover potential trade to neighboring countries.

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