Gravity and Heterogeneous Trade Cost Elasticities

How do trade costs affect international trade? This paper offers a new approach. We rely on a flexible gravity equation that predicts variable trade cost elasticities, both across and within country pairs. We apply this framework to popular trade cost variables such as currency unions, trade agreements, and WTO membership. While we estimate that these variables are associated with increased bilateral trade on average, we find substantial heterogeneity. Consistent with the predictions of our framework, trade cost effects are strong for ‘thin’ bilateral relationships characterised by small import shares, and weak or even zero for ‘thick’ relationships.

The key role of quoted spreads in financial services and transactions

Banking has driven the development of the world for centuries. An interesting issue to analyze is the optimal spread on financial products reflecting the value added that does not generate economic distortions for consumers in intertemporal decisions. Based on a gravity equation for these services, this paper examines the optimality of a modified Quoted Spread, the recently-proposed mobile-ratio, by assessing whether the pure interest expressed as a gravity equation between interests does not change after applying this spread. Results show that the mobile-ratio is the specification of the spread with no distortions on investment decisions. Regarding fiscal policy, this ratio plays a key role for both the Financial Transaction Tax and the VAT on financial services.

Appendix. The determinants of world wheat trade, 1963-2010: A gravity equation approach

Appendix to the article The determinants of world wheattrade, 1963-2010:A gravity equation approach (DOI 10.26882/histagrar.083e05g)

Effects of Logistics Performance as Non-discriminatory Trade Policies on Indonesia’s Textile Products Exports

ABSTRACTThis study discusses the importance of trade facilitation in logistic performance to boost Indonesia’s export. This work uses a structural gravity model to analyze the effect of logistics performance with respect to the export magnitude of textile products from Indonesia to its trading partner countries worldwide. This paper uses interval panel data for 2010, 2012, and 2014. In particular, it employs the Logistics Performance Index (LPI) as a proxy for trade facilitation and as a non-discriminatory trade policy of the origin country. Further, this study considers intranational trade in the structural gravity equation to ensure that the estimation effects for the non-discriminatory export policy in logistics can be identified in the presence of the fixed effect. The estimation results reveal that the LPI could play a role in expanding the export of textile products from Indonesia.Keywords: Logistics Performance Index (LPI), trade facilitation, non-discriminatory trade policy, structural gravity equation, export, textile, IndonesiaABSTRAKStudi ini membahas pentingnya fasilitasi perdagangan dalam kinerja logistik untuk mendorong ekspor Indonesia. Penelitian ini menggunakan model gravitasi struktural untuk menganalisis pengaruh kinerja logistik terhadap besarnya ekspor produk tekstil dari Indonesia ke negara-negara mitra dagangnya di seluruh dunia. Tulisan ini menggunakan data panel dengan interval untuk 2010, 2012 dan 2014. Secara khusus, studi ini menggunakan Logistics Performance Index (LPI) sebagai proksi untuk fasilitasi perdagangan dan LPI sebagai cerminan kebijakan perdagangan non-diskriminatif dari negara asal. Selanjutnya, penelitian ini juga menggunakan data perdagangan intranasional dalam persamaan gravitasi struktural untuk memastikan bahwa efek estimasi untuk kebijakan ekspor non-diskriminatif dalam logistik dapat diidentifikasi walau dengan adanya fixed effect. Hasil estimasi menunjukkan bahwa LPI dapat berperan dalam memperluas ekspor produk tekstil dari Indonesia.Keywords Kata Kunci: Logistics Performance Index (LPI), fasilitasi perdagangan, kebijakan perdagangan non-diskriminatif, persamaan gravitasi struktural, ekspor, tekstil, Indonesia

Unified Field Theory for Electromagnetic and Gravity Fields with the Introduction of Quantized Space–Time and Zero-Point Energy

In our previous papers [1,3], using only the concepts of the zero-point energy and quantized space–times, all the fields including gravity were explained. However, the previous papers had the following limitations: First, the concept of the quantized space-time must be experimentally confirmed. Second, we should clarify the meaning of the quantized Einstein’s gravity equation, which is derived in [1]. Moreover, in another paper [2], we succeeded in describing the neutrinos’ self-energy and their oscillations. However, this paper assumes the rest energy of 3-leptons in advance, which is why we needed to uncover the reason why leptons have 3-generations. As mentioned, using the concepts of the zero-point energy and quantized space–times, we derived the quantized Einstein’s gravity equation in our previous paper [1]. The paper provides an analytical solution of this equalized Einstein’s equation, which implies the conservation of angular momentum in terms of quantized space–times. Employing this solution and without the standard big bang model, a unique form of acceleration equation for the acceleration-expansion universe is derived. Moreover, the temperature of the cosmic microwave background (CMB) emission is also obtained. Further, this solution results in an analytical (not numerical) derivation of the gravity wave. Moreover, based on the configuration of quantized space–times in terms of both electric and magnetic fields, we analytically attempted to calculate every equation in terms of electromagnetic and gravity fields, using the solution of the quantized Einstein’s gravity equation. As a result of this theory, first the calculated acceleration and temperature of CMB emission agree with the measurements. Furthermore, the analytical solution of the quantized Einstein’s gravity equation resulted in all the laws of electromagnetic and gravity fields in addition to the analytically derived gravity wave, which agrees well with the recent measurements. Moreover, the calculations of the energies in the basic configuration of the quantized space–times resulted in all 3-leptons’ rest energies. Considering this basic configuration is uniformly distributed everywhere in the universe, we can conclude that τ-particles or static magnetic field energy derived from the basic configuration of the quantized space–times is the identity of dark energy, which also distributes uniformly in the universe.