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Trade Flows and Spatial Effects: The Gravity Model Revisited

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  • Porojan, A.

Abstract

The paper revisits the popular gravity model of trade in the light of the increasingly acknowledged findings of spatial econometrics and interprets the results in view of some recent theoretical developments from the economic literature that contribute to its foundation. When the inherent spatial effects are explicitly taken into account, the magnitude of the estimated parameters changes considerably and, with it, the measures on the predicted trade flows. This result is illustrated on the case of predicted trade flows between the EU and some of its potential members.

Suggested Citation

  • Porojan, A., 2000. "Trade Flows and Spatial Effects: The Gravity Model Revisited," Discussion Papers 0004, University of Exeter, Department of Economics.
    • Handle: RePEc:exe:wpaper:0004
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    Citations

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    Cited by:

    1. Ronaldo Daniel Da Mata & Rogério Edivaldo Freitas, 2008. "Produtos Agropecuários: Para quem Exportar?," Discussion Papers 1321, Instituto de Pesquisa Econômica Aplicada - IPEA.
    2. Karagoz Kadir, 2014. "Determinants Of Tourist Inflows To Romania: Evidence From Augmented Panel Gravity Model," Annals of Faculty of Economics, University of Oradea, Faculty of Economics, vol. 1(1), pages 347-358, July.
    3. Acosta Rojas, Gina E. & Calfat, Germán & Flôres Junior, Renato Galvão, 2005. "Trade and infrastructure: evidences from the Andean Community," FGV EPGE Economics Working Papers (Ensaios Economicos da EPGE) 580, EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil).
    4. Calfat, Germán & Flôres, Renato G. & Acosta Rojas, Gina E., 2006. "Trade and infrastructure in the Andean Community," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), December.
    5. M. Ševela, 2002. "Gravity-type model of Czech agricultural export," Agricultural Economics, Czech Academy of Agricultural Sciences, vol. 48(10), pages 463-466.

    More about this item

    Keywords

    TRADE ; ECONOMETRICS ; SPATIAL ANALYSIS;
    All these keywords.

    JEL classification:

    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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