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Explaining the Volume of North-South Trade in Ireland - A Gravity Model Approach

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  • Emla Fitzsimons

    (University College Dublin)

  • Vincent Hogan

    (University College Dublin)

  • J. Peter Neary

    (University College Dublin)

Abstract

We address the question of whether the volume of manufacturing trade between Northern Ireland and the Republic of Ireland is more or less than might be expected in the light of international experience. We estimate a gravity equation for bilateral manufacturing trade between 28 developed countries from 1970 to 1992. Using the results as benchmark, we find that North-South trade in Ireland is greater rather than less than might be expected. The finding is robust with respect to a wide range of alternative specifications and alternative ways of measuring the key variables.

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File URL: http://www.esr.ie/vol30_4/3_Fitzsimons.pdf
File Function: First version, 1999
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Bibliographic Info

Article provided by Economic and Social Studies in its journal Economic and Social Review.

Volume (Year): 30 (1999)
Issue (Month): 4 ()
Pages: 381-401

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Handle: RePEc:eso:journl:v:30:y:1999:i:4:p:381-401

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References

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  1. Hummels, D. & Levinsohn, J., 1993. "Monopolistic Competition and International Trade: Reconsidering the Evidence," Working Papers 339, Research Seminar in International Economics, University of Michigan.
  2. Simon J. Evenett & Wolfgang Keller, 1996. "On Theories Explaining the Success of the Gravity Equation," International Trade 9608001, EconWPA, revised 13 Jun 1997.
  3. Engel, C. & Rogers, J.H., 1995. "How Wide is the Border?," Papers 4-95-16, Pennsylvania State - Department of Economics.
  4. McCallum, John, 1995. "National Borders Matter: Canada-U.S. Regional Trade Patterns," American Economic Review, American Economic Association, vol. 85(3), pages 615-23, June.
  5. Elhanan Helpman, 1998. "The Structure of Foreign Trade," Harvard Institute of Economic Research Working Papers 1848, Harvard - Institute of Economic Research.
  6. Bergstrand, Jeffrey H, 1989. "The Generalized Gravity Equation, Monopolistic Competition, and the Factor-Proportions Theory in International Trade," The Review of Economics and Statistics, MIT Press, vol. 71(1), pages 143-53, February.
  7. Leamer, Edward E. & Levinsohn, James, 1995. "International trade theory: The evidence," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 26, pages 1339-1394 Elsevier.
  8. Robert C. Feenstra & Robert E. Lipsey & Harry P. Bowen, 1997. "World Trade Flows, 1970-1992, with Production and Tariff Data," NBER Working Papers 5910, National Bureau of Economic Research, Inc.
  9. Helpman, Elhanan, 1987. "Imperfect competition and international trade: Evidence from fourteen industrial countries," Journal of the Japanese and International Economies, Elsevier, vol. 1(1), pages 62-81, March.
  10. Deardorff, A.V., 1995. "Determinants of Bilateral Trade : Does Gravity Work in a Neoclassical World?," Papers 95-05, Michigan - Center for Research on Economic & Social Theory.
  11. Jeffrey A. Frankel & Ernesto Stein & Shang-Jin Wei, 1998. "Continental Trading Blocs: Are They Natural or Supernatural?," NBER Chapters, in: The Regionalization of the World Economy, pages 91-120 National Bureau of Economic Research, Inc.
  12. Anderson, James E, 1979. "A Theoretical Foundation for the Gravity Equation," American Economic Review, American Economic Association, vol. 69(1), pages 106-16, March.
  13. Bergstrand, Jeffrey H, 1985. "The Gravity Equation in International Trade: Some Microeconomic Foundations and Empirical Evidence," The Review of Economics and Statistics, MIT Press, vol. 67(3), pages 474-81, August.
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Cited by:
  1. Joan Costa-i-Font, 2010. "Regional Single Currency Effects on Bilateral Trade with the European Union," Europe in Question Discussion Paper Series of the London School of Economics (LEQs) 6, London School of Economics / European Institute.
  2. Christie Smith, 2002. "Currency unions and gravity models revisited," Reserve Bank of New Zealand Discussion Paper Series DP2002/07, Reserve Bank of New Zealand.
  3. Richard Pomfret, 2005. "Sequencing Trade and Monetary Integration," Others 0502004, EconWPA.
  4. Johan Fourie & Maria Santana-Gallego, 2012. "Ethnic Reunion and Cultural Affinity," Working Papers 293, Economic Research Southern Africa.
  5. Johan Fourie & Mar�a Santana-Gallego, 2013. "The determinants of African tourism," Development Southern Africa, Taylor & Francis Journals, vol. 30(3), pages 347-366, September.
  6. Cardamone, Paola, 2007. "A survey of the assessments of the effectiveness of Preferential Trade Agreements using gravity models," Working Papers 7282, TRADEAG - Agricultural Trade Agreements.
  7. Richard Pomfret, 2004. "Sequencing Trade and Monetary Integration: Issues and Applications to Asia," School of Economics Working Papers 2004-14, University of Adelaide, School of Economics.
  8. Keith Walsh, 2006. "Trade in Services: Does Gravity Hold? A Gravity Model Approach to Estimating Barriers to Services Trade," The Institute for International Integration Studies Discussion Paper Series iiisdp183, IIIS.
  9. Joan Costa-i-Font, 2010. "Regional single currency effects on bilateral trade with the European Union," LSE Research Online Documents on Economics 53292, London School of Economics and Political Science, LSE Library.
  10. Andres Faiña & Jesus Lopez-Rodríguez, 2003. "Population Potentials and Development Levels: Empirical Findings in the European Union," ERSA conference papers ersa03p30, European Regional Science Association.
  11. Dieter Billen & Maria Melody Garcia & Nelli Khasanova, 2005. "Is the Effect of Exchange Rate Volatility on Trade More Pronounced in Latin America than in Asia?," Kiel Advanced Studies Working Papers 434, Kiel Institute for the World Economy.
  12. Richard Pomfret, 2003. "Formation and Dissolution of Monetary Unions: Evidence from Europe, and Lessons for Elsewhere," School of Economics Working Papers 2003-03, University of Adelaide, School of Economics.

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