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Markket Integration and Energy Trade Efficiency: An Application of Malmqvist Index to Analyse Multi-Product Trade

Author

Listed:
  • Yu SHENG

    (Australian National University)

  • Yanrui WU

    (University of Western Australia)

  • Xunpeng SHI

    (National University of Singapore)

  • Dandan ZHANG

    (Peking University)

Abstract

As This paper uses the data envelope analysis method to investigate the Malmquist index-based gravity relationship between bilateral energy trade flows and their determinants throughout the world. Using a balance panel data of 40 countries between 1995 and 2008, this paper shows that market integration will increase energy trade by improving trade efficiency between trade partners, though allowing for a flexible substitution between different energy products tends to weaken these effects. This result highlights cross-product substitution and its implications for the aggregate energy trade pattern, providing insights on the importance of prioritising product-specific trade facilitating policies.

Suggested Citation

  • Yu SHENG & Yanrui WU & Xunpeng SHI & Dandan ZHANG, 2014. "Markket Integration and Energy Trade Efficiency: An Application of Malmqvist Index to Analyse Multi-Product Trade," Working Papers DP-2014-20, Economic Research Institute for ASEAN and East Asia (ERIA).
    • Handle: RePEc:era:wpaper:dp-2014-20
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    energy trade efficiency; energy market integration; Malmquist index;
    All these keywords.

    JEL classification:

    • Q27 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Issues in International Trade
    • Q47 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy Forecasting
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence

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