The gravity model and trade flows: Recent developments in econometric modeling and empirical evidence

Kabir, Mahfuz; Salim, Ruhul; Al-Mawali, Nasser

doi:10.1016/j.eap.2017.08.005

Cited by 106 publications

(59 citation statements)

References 72 publications

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“…See also (Kepaptsoglou, Karlaftis, & Tsamboulas, 2010) who survey over 75 papers that used the gravity model to analyze trade flows among different groups of countries, in the early 2000s. Their conclusion highlights the suitability of the gravity model, which, however, exhibited a range of novel applications (for details see Anderson & Van Wincoop, 2003; Head & Mayer, 2014; Head, Mayer, & Ries, 2010; Helpman, Melitz, & Rubinstein, 2008; Kabir et al, 2017; Kahouli & Maktouf, 2013; Vicard, 2011). All these authors argue that the gravity model is useful because it performs well in estimating the trade effects of geographic locations and trade agreements and enables the identification of anomalies in estimating the volume of trade between countries.…”

Section: Related Literaturementioning

confidence: 99%

“…In summary, the issue of the trade effects of RTAs has been thoroughly discussed in the literature, however, this issue remains an empirical one. As Kabir et al (2017) argue, there is no general equation to be used in any empirical work. The current study, thus, focuses on EAC countries and considers a specific gravity model that controls for country time‐varying effects while retaining the country‐pair fixed effects.…”

Section: Related Literaturementioning

confidence: 99%

“…Hence, we follow the recent specification of the gravity model developed in a series of papers by Baier and Bergrstrand (2004, 2007), Baier, Bergstrand, and Mariutto (2014), and further developed in Kabir, Salim, and Al‐Mawali (2017). The main contribution of this study is threefold.…”

Section: Introductionmentioning

confidence: 99%

See 2 more Smart Citations

Estimation of the East African Community's trade benefits from promoting intra‐regional trade

Umulisa

2020

African Development Review

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In the literature on economic integration, the optimum currency area (OCA) theory says that there should be a high degree of trade between potential members of a monetary union for them to benefit from the use of a single currency. This study uses an augmented gravity model of trade to estimate the East African Community's (EAC) trade effects, as this community decided to participate in a monetary union by 2024. The study uses the fixed effect filter (FEF) estimator, which follows a two‐step approach and outperforms the standard fixed effects (FE) estimator. The results indicate that EAC has the potential to increase trade among partner states by 122% more than expected from the normal trade levels. The study, therefore, supports the ongoing East African Monetary Union process. However, to improve the likelihood of creating a more sustainable monetary union, the study recommends these countries to primarily focus on the full implementation of the customs union and common market steps. The main contribution of this study is that it provides robust estimates of the EAC's effects on intra‐regional trade using more recent data and updated econometric techniques.

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Section: Related Literaturementioning

confidence: 99%

Section: Related Literaturementioning

confidence: 99%

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Estimation of the East African Community's trade benefits from promoting intra‐regional trade

Umulisa

2020

African Development Review

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“…The importance of food security cooperation to ensure food security urgently needs to constantly improve methods, accurately judge the potential between countries, and put forward integrated development suggestions. In further method combing, it is found that the existing quantitative research on cooperation potential focused on agricultural product trade potential using index analysis [33,34], trade gravity model [35][36][37], and stochastic frontier gravity model [38][39][40]. The analysis of agricultural cooperation potential is mostly qualitative [41][42][43].…”

Section: Potential Index Of Food Security Cooperationmentioning

confidence: 99%

“…The coefficient of transport convenience is calculated mainly by considering distance factors and infrastructure conditions. Drawing lessons from the trade gravity model and other research, this research uses the data of straight-line distance between capital cities, total railway length, and highway density by assigning a value to the transport convenience between two countries as main indicator to calculate the transport convenience coefficient [37,52,53]. In the case of the BRICS countries, the nearest distance gets 1 point, followed by 0.8, 0.6, and 0.4 points, respectively.…”

Section: Potential Index Of Food Security Cooperationmentioning

confidence: 99%

Development and Prospect of Food Security Cooperation in the BRICS Countries

Ren

Wang

et al. 2020

Sustainability

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In recent years, the international status of agriculture in the BRICS countries—Brazil, Russia, India, China and South Africa—has been continuously improved. In 2018, the gross agricultural production of the BRICS countries accounted for more than 50% of the world’s total. Further strengthening the developing cooperation of the BRICS countries is of great significance for ensuring global food security. Based on the data from FAOSTAT and UN Comtrade Database, this study builds a food self-sufficiency rate and food security cooperation potential index to quantitatively analyze the food security status, cooperation effectiveness, and future trends of the BRICS countries. The study finds that the overall food security of the BRICS countries is generally showing a trend of volatility and growth, with high rates for cereals and relatively low rates for fresh products. In the future, BRICS food security cooperation should be based on their own resource endowment and socioeconomic characteristics. The BRICS countries need to constantly improve the awareness of joint cooperation and action in the future, focusing on scientific and technological cooperation, information sharing, complementary advantages in trade, and improving the global competitiveness of products. With the help of agricultural science and technology, Brazil is growing as a strong export country of food products. Russia needs to increase the introduction of agricultural science and technology and foreign capital to give full play to its resource advantages. India can improve its food self-sufficiency faster by the construction of a BRICS Agricultural Research Platform. China makes full use of BRICS resources, actively promotes agricultural enterprises to go global, and constantly optimizes the food supply structure. South Africa maintains the advantages of fruit and vegetable industry and increases the introduction and promotion of agricultural science and technology to improve the domestic food production capacity.

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The spatial diffusion of “multi‐station integration” and sustainable development: From the perspective of eight economic zones in China

Jian

Liu

Hou

2022

Engineering Reports

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China's power system driven by the ubiquitous power internet of things, a new operation mode—“multi‐station integration” (MSI) has emerged. The novel business model can improve the energy utilization efficiency and promote the cross‐border business integration. In some earlier studies, mainly focused on conceptual analysis of application scenarios and operation modes of MSI. However, quantitative analysis that measure MSI popularize remain under development. This article highlights the recent advance achievements in MSI of digital power grid regarding transformation of Chinese eight economic zones. From the perspective of spatial heterogeneity, the gravity model provides a framework for describing the spatial diffusion of MSI mode relative to eight economic zones (EEZ) in China. In addition, compared to conventional gravity model, this study improved four aspects of the basic spatial gravity model ‐ diffusion capacity, absorptive capacity, the gravitation coefficient, and economic distance. It is found that the spatial diffusion of MSI is subjected to eight economic zones interaction while the spatial heterogeneity is inevitable. Thus, the resulting represents a radial decline, with the three coastal economic zones as the center, gradually decreasing to the inland and western regions, especially for those coastal economic regions with large diffusion impacts. Meanwhile, we also discuss the advantages, impacts, and limitations of MSI spatial diffusion as valuable references for future development direction of MSI mode. Ultimately, some of future development recommendations for MSI emerging field is put forward.

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The gravity model and trade flows: Recent developments in econometric modeling and empirical evidence

Cited by 106 publications

References 72 publications

Estimation of the East African Community's trade benefits from promoting intra‐regional trade

Estimation of the East African Community's trade benefits from promoting intra‐regional trade

Development and Prospect of Food Security Cooperation in the BRICS Countries

The spatial diffusion of “multi‐station integration” and sustainable development: From the perspective of eight economic zones in China

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