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Modeling International Trade Flows between CEEC and OECD Countries

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Author Info
Christophe Rault ()
Robert Sova ()
Ana Maria Sova ()

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Abstract

This article deals with econometric developments for the estimation of gravity model, which allow to get convergent parameter estimates even when a correlation exists between the explanatory variables and the specific unobservable characteristics of each individual. We implement panel data econometric techniques to characterize bilateral trade flows between heterogeneous economies. Our econometric results based on a sample of 4 Central and Eastern European countries (CEEC-4) and 19 OECD countries over a 18-year period highlight the importance by taking into account the unobservable heterogeneity to obtain a robust empirical specification and unbiased coefficients.

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Publisher Info
Paper provided by CESifo Group Munich in its series CESifo Working Paper Series with number CESifo Working Paper No. 2282.

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Date of creation: 2008
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Handle: RePEc:ces:ceswps:_2282

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Related research
Keywords: gravity models; unobservable heterogeneity; panel data models; international trade flows;

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Find related papers by JEL classification:
C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
F15 - International Economics - - Trade - - - Economic Integration

Cited by:
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  1. Sova, Robert & Albu, Lucian Liviu & Stanciu, Ion & Sova, Anamaria, 2009. "Patterns of Foreign Direct Investment in the New EU Countries," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 6(2), pages 42-51, June. [Downloadable!]
  2. Guglielmo Maria Caporale & Christophe Rault & Robert Sova & Ana Maria Sova, 2008. "On the Bilateral Trade Effects of Free Trade Agreements between the EU-15 and the CEEC-4 Countries," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
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This page was last updated on 2009-12-1.

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