HighlightsThis paper explores the World Trade using the Network Analysis and introduces the reader to some of the techniques used to visualize, calculate and synthetically represent network trade data. The paper shows different visualizations of the network and describe its topological properties, producing and discussing some of the commonly used Network's statistics, and presenting some specific topics. All in all, this paper shows that Network Analysis is a useful tool to describe bilateral trade relations among countries when interdependence matters, and when trade relations are characterized by high dimensionality and strong heterogeneity. AbstractIn this paper we explore the BACI-CEPII database using Network Analysis. Starting from the visualization of the World Trade Network, we then define and describe the topology of the network, both in its binary version and in its weighted version, calculating and discussing some of the commonly used network's statistics. We finally discuss some specific topics that can be studied using Network Analysis and International Trade data, both at the aggregated and sectoral level. The analysis is done using multiple software (Stata, R, and Pajek). The scripts to replicate part of the analysis are included in the appendix, and can be used as an handson tutorial. Moreover,the World Trade Network local and global centrality measures, for the unweighted and the weighted version of the Network, calculated using the bilateral aggregate trade data for each country (178 in total) and each year (from 1995 to 2010,) can be downloaded from the CEPII webpage.JEL Classification: F10

Economic integration, dynamic panel data,

HighlightsThis paper explores the World Trade using the Network Analysis and introduces the reader to some of the techniques used to visualize, calculate and synthetically represent network trade data. The paper shows different visualizations of the network and describe its topological properties, producing and discussing some of the commonly used Network's statistics, and presenting some specific topics. All in all, this paper shows that Network Analysis is a useful tool to describe bilateral trade relations among countries when interdependence matters, and when trade relations are characterized by high dimensionality and strong heterogeneity. AbstractIn this paper we explore the BACI-CEPII database using Network Analysis. Starting from the visualization of the World Trade Network, we then define and describe the topology of the network, both in its binary version and in its weighted version, calculating and discussing some of the commonly used network's statistics. We finally discuss some specific topics that can be studied using Network Analysis and International Trade data, both at the aggregated and sectoral level. The analysis is done using multiple software (Stata, R, and Pajek). The scripts to replicate part of the analysis are included in the appendix, and can be used as an handson tutorial. Moreover,the World Trade Network local and global centrality measures, for the unweighted and the weighted version of the Network, calculated using the bilateral aggregate trade data for each country (178 in total) and each year (from 1995 to 2010,) can be downloaded from the CEPII webpage.JEL Classification: F10

The paper shows how - using as an example the trade flows between eleven European countries and 31 OECD `reporting' countries - the result of a gravity model, in terms of potential trade, changes substantially when country heterogeneity and dynamics are taken into account. Comparing the in-sample trade potential index derived from various estimators yields three different results: (a) the average trade potential index poorly represents the distribution of yearly trade potentials; (b) the index converges towards the demarcation value corresponding to the equality between observed and predicted trade flows when country heterogeneity and dynamics are taken into account; (c) the sign of its yearly average is not the right statistic with which to determine the (in)existence of unrealized trade potentials. Finally, the index derived from a dynamic specification with multilateral fixed-effects is better able to reflect the role played by the time-variant country-specific unobservable element associated with the possible presence of positive or negative trade potentials.

This paper provides an update on estimates of the euro effect on trade integration among EMU economies, taking into account the aggregate bilateral exports of 23 OECD countries for the sample period 1988-2004. We consider 13 exporting European countries and 23 importing industrialized countries We utilize the dynamic panel data estimator proposed by Blundell and Bond (1998) and introduce controls for heterogeneity. The results of our dynamic specification of the gravity equation yield an estimate of the short run intra-Eurozone pro-trade effect, following the adoption of the single currency, which is as high as around 4% (17% in the long run). This finding, slightly lower than the results set out in our previous studies, is in line with those of very recent empirical analyses using dynamic specification of the gravity equation. It is also consistent with the already tight trade links characterizing the economies that have adopted the euro.