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Social Development and International Trade in Central Europe

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  • Andrzej Cieslik, Jan Jakub Michalek, Jerzy Mycielski

    ()
    (University of Warsaw, Poland)

Abstract

In this paper we study the impact of social development on international trade in Central and Eastern Europe using the generalized gravity model. Many previous empirical studies which explored the determinants of trade flows, concentrated only on traditional gravity variables, such as the size of trading partners, factor abundance, technology differences or distance. In our study, in addition to the standard set of gravity variables, we examine the role of aggregate social develop-ment indicators such as Human Development Index and its components. Our results show that both aggregate and disaggregate measures of social development affect the volume of international trade flows. In particular, the education indexes seem to be positively related to bilateral trade flows.

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Bibliographic Info

Article provided by Uniwersytet Mikolaja Kopernika in its journal Equilibrium. Quarterly Journal of Economics and Economic Policy.

Volume (Year): 7, Issue 2 (2012)
Issue (Month): ()
Pages: 7-19

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Handle: RePEc:cpn:umkequ:2012:v2:1

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Keywords: social development indices; bilateral trade flows;

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  1. Robert J. Barro & Jong-Wha Lee, 2000. "International Data on Educational Attainment: Updates and Implications," CID Working Papers, Center for International Development at Harvard University 42, Center for International Development at Harvard University.
  2. Markusen, James R, 1986. "Explaining the Volume of Trade: An Eclectic Approach," American Economic Review, American Economic Association, American Economic Association, vol. 76(5), pages 1002-11, December.
  3. Sen, Amartya K, 1976. "Real National Income," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 43(1), pages 19-39, February.
  4. Melitz, Marc J, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," CEPR Discussion Papers, C.E.P.R. Discussion Papers 3381, C.E.P.R. Discussion Papers.
  5. Ranis, G. & Ramirez, A. & Stewart, F., 1997. "Economic Growth and Human Development," Papers, Yale - Economic Growth Center 787, Yale - Economic Growth Center.
  6. Irena Grosfeld & Claudia Senik, 2010. "The emerging aversion to inequality," The Economics of Transition, The European Bank for Reconstruction and Development, The European Bank for Reconstruction and Development, vol. 18(1), pages 1-26, 01.
  7. Gustav Ranis & Frances Stewart, 2005. "Dynamic Links between the Economy and Human Development," Working Papers, United Nations, Department of Economics and Social Affairs 8, United Nations, Department of Economics and Social Affairs.
  8. Granger, C W J, 1969. "Investigating Causal Relations by Econometric Models and Cross-Spectral Methods," Econometrica, Econometric Society, Econometric Society, vol. 37(3), pages 424-38, July.
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