The Impact of Immigration on Portuguese Intra-Industry Trade
AbstractThis paper investigates the relationship between intra-industry trade (IIT) and immigration flows using a gravity model for the period 2000-2010 between Portugal and European Union’s Member States (EU-27). The present study uses the methodology of Kandogan (2003) for separating IIT into its components horizontal (HIIT) and vertical intra-industry trade (VIIT). Using a panel data approach, our study find that immigration has a positive influence on Portuguese intra-industry trade. These results indicate that the immigration can reduce transaction costs between home and host country. We also consider in econometric model, the economic dimension which appears to exercise a positive effect on IIT. Our results confirm the hypothesis that there is a negative effect of transportation costs on trade.
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Bibliographic InfoPaper provided by Fondazione Eni Enrico Mattei in its series Working Papers with number 2013.20.
Date of creation: Feb 2013
Date of revision:
Gravity Model; Horizontal and Vertical Intra-industry Trade Immigration and Panel Data;
Find related papers by JEL classification:
- C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
- C30 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - General
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- L10 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-04-06 (All new papers)
- NEP-INT-2013-04-06 (International Trade)
- NEP-MIG-2013-04-06 (Economics of Human Migration)
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