Trade Flows of Bangladesh: A Gravity Model Approach
Abstract
This study gives an overview of different methodologies related to gravity model analysis in Bangladesh trade flow. A pooled cross section and time series data were analyzed to incorporate the country specific heterogeneity in country pair trading partners. The trade flows are justified by the basic gravity model since Bangladesh trade is positively significant by the economy size and inversely related to trade barrier. Accordingly, pooled ordinary least square, fixed effect and random effect methods are implied. This study also explores extended gravity model that depicts trade is determined by the gross domestic product, openness of the economy and exchange rate. In addition, cross section results show that regional trade arrangement which is South Asian Association for Regional Co-operation and border are significant for Bangladesh trade.Download Info
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Article provided by AccessEcon in its journal Economics Bulletin.
Volume (Year): 31 (2011)
Issue (Month): 1 ()
Pages: 950-959
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Related research
Keywords: Gravity model; Pooled Ordinary Least Square; Fixed effect; Random effect.;Find related papers by JEL classification:
- F1 - International Economics - - Trade
- C5 - Mathematical and Quantitative Methods - - Econometric Modeling
References
References listed on IDEASPlease report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Hossain, Sharif M., 2009. "South Asian Free Trade Area: Implications for Bangladesh," MPRA Paper 18517, University Library of Munich, Germany.
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