The Gravity Model for Assessing Trade Patterns: the Case of Baltic States

Čipkutė, Eivilė

doi:10.15388/ekon.2016.3.10330

Cited by 6 publications

(4 citation statements)

References 19 publications

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“…Most of the recent studies used GDP and population as an indicator of nations' economic development. Based on gravity model studies of trade patterns in Baltic countries, Ciptuke found the trading countries' market size to be an important driver of trading patterns [111]. As well as being a variable to impact global trade, the population is also used to evaluate the market volume of a specific country.…”

Section: Economic Distancementioning

confidence: 99%

Sustaining Trade during COVID-19 Pandemic: Establishing a Conceptual Model Including COVID-19 Impact

2021

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The conceptual research aims to identify antecedents conducive to bilateral trade during the COVID-19 pandemic. Considering the relevance of bilateral trade for foreign policy and economy studies, there is a need for a renewed framework in times of extreme economic instability. As international commerce is essential for improving the country’s economy, we have examined how economic distance, population, trade percentage of GDP, exchange rate, and political changes interconnect and relate to COVID-19, influencing trade flows. This conceptual paper illustrates the likely impact of COVID-19 on international trade by exploring pandemics’ effects on standard trading parameters such as GDP, distance, policy stability, and population. We model the resulting shock as a multifaceted variable reflected in capital underutilization, manufacturing output decline, international trade costs inflation, production costs inflation, decrease in demand for certain services and shift from everyday needs towards activities that exclude the proximity between people, e.g., proclivity towards virtual market products. The sudden decrease in GDP and bilateral trade, as well as FDI, is amplified by further development of pandemics’ long-term consequences. We take COVID-19 to be a technological, financial, and policy shock significantly influencing international trade and economic development and argue that it will have a varying impact on diverse sectors and economies. The paper offers preliminary insight into the pandemic-related economics that are unfolding and deduce recommendations on positive changes in trading policy to fully leverage on arising trading opportunities and point to potential research directions.

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Section: Economic Distancementioning

confidence: 99%

Sustaining Trade during COVID-19 Pandemic: Establishing a Conceptual Model Including COVID-19 Impact

2021

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“…The Gravity Model has been used in analyzing bilateral trade ow between countries (see: Duzgun Oncel, B. and Tekce, M., 2014;Drzewoszewska, N., 2014;Reyes, J., Wooster, R., and Shirrell, S., 2014;Hayakawa, K., Kimura, F., and Nabeshima, K., 2014;Ravishankar, G. and Stack M., 2014;Mohmand, Y., Salman, A., Mughal, K., Imram, M., and Makarevic, N., 2015;Kunroo, M. and Azad, N., 2015;Gylfason, T., Martinez-Zarzoso, I., and Wijkman, P. 2015;Kahouli, B. and Maktouf, S., 2015;Papalia, R. and Bertarelli, S., 2015;Khosla, P., 2015;Boxell, L., 2015;Proenca, I., Sperlich, S., and Savasci, D., 2015;Gervais, A., 2015;Egger, P. and Staub, K., 2016;Madah, M. and Nagheli, S., 2016;Cipkute, E., 2016;Bujang, A., 2016;Hndi, B., Maitah, M., and Mustofa, J., 2016). Based on the Gravity Model, higher income countries are drawn toward each other by gravitational pull of their respective size and other push and pull factors.…”

Section: Literature Reviewmentioning

confidence: 99%

“…International trade is a key element of Globalization and a country's participation in international trade is a path to economic growth (Cipkute, E., 2016). There has been study showing the reverse causality between openness to trade and economic growth (Gervais, A., 2015).…”

Section: Literature Reviewmentioning

confidence: 99%

Trade Agreement as a Model of Development: The Case of the Japan-Philippine Economic Partnership Agreement (JPEPA)

Navarrete

Tatlonghari

2020

Preprint

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“…Suvannaphakdy and Toyoda [19] using import tariffs as an additional variable in the gravity model. Most studies analyzing the effects of trade use panel data regression to find empirical results [9,34,36,40,[44][45][46][47][48][49][50][51][52][53][54].…”

Section: Introductionmentioning

confidence: 99%

Determinants of Cocoa Bean Trade in the International Market: Gravity Model Approach

Nisa’,

Darsono,

Antriyandarti

2023

IJSDP

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Cocoa beans are one of Indonesia's primary export commodities, ranking fourth in terms of foreign exchange earnings. Under conditions of free trade, this study aimed to analyze the determinants of the export value of Indonesian cocoa beans compared to its competitors in West African countries (Ivory Coast, Ghana, and Nigeria). The research method used is the gravity model with panel data from 2000 -2020, using STATA 14.2 and Microsoft Excel. The results indicate that the variables significantly affecting the export value of cocoa beans are economic distance, production, export volume, the population of exporting countries, harvested area, exchange rate, and membership in AFCFTA. Other variables are not significant. This study concludes that the effect of export volume and production of cocoa beans, economic distance, and exchange rate are positive, while the effect of membership in AFCFTA is negative. However, this study is unable to analyze the factors that influence the trade of Indonesian cocoa beans and its competitor countries to the import destination country (Malaysia) as well as the export of cocoa beans (raw or roasted). Future research direction includes exploring Indonesia's post-COVID-19 international trade strategy and food safety issues.

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The Gravity Model for Assessing Trade Patterns: the Case of Baltic States

Cited by 6 publications

References 19 publications

Sustaining Trade during COVID-19 Pandemic: Establishing a Conceptual Model Including COVID-19 Impact

Sustaining Trade during COVID-19 Pandemic: Establishing a Conceptual Model Including COVID-19 Impact

Trade Agreement as a Model of Development: The Case of the Japan-Philippine Economic Partnership Agreement (JPEPA)

Determinants of Cocoa Bean Trade in the International Market: Gravity Model Approach

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