A Tale of Parallel Integration Processes. A Gravity Analysis of EU Trade with Mediterranean and Central and Eastern European Countries
AbstractDespite the EU emphasis on the 1995 Barcelona process, trade integration with the Mediterranean (MED) countries is still underdeveloped. To contrast the success of EU integration with MED countries and that with the new EU members, we compute the trade potential of these EU partners from 1995 to 2002 using an "out-of-sample" methodology. The coefficients are taken from different panel estimators of the gravity equation relative to intra-EU trade. Our analysis suggests the existence of sizeable, unexploited trade potential with both groups of partners, although the ratio of potential to actual trade with the MED countries is much larger (from 1.7 to 2.5 times), more dispersed and stable compared to that with the CEECs. Moreover, the potential tends to converge to actual trade in a much longer time in the case of MED countries.
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Bibliographic InfoPaper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 1829.
Length: 32 pages
Date of creation: Nov 2005
Date of revision:
Publication status: published in: Review of Middle East Economics and Finance, 2009, 5 (2), Article 2
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Other versions of this item:
- Pastore Francesco & Ferragina Anna Maria & Giovannetti Giorgia, 2009. "A Tale of Parallel Integration Processes: A Gravity Analysis of EU Trade with Mediterranean and Central and Eastern European Countries," Review of Middle East Economics and Finance, De Gruyter, vol. 5(2), pages 21-44, September.
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Longitudinal Data; Spatial Time Series
- F15 - International Economics - - Trade - - - Economic Integration
- F17 - International Economics - - Trade - - - Trade Forecasting and Simulation
- P45 - Economic Systems - - Other Economic Systems - - - International Linkages
- P52 - Economic Systems - - Comparative Economic Systems - - - Comparative Studies of Particular Economies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-11-19 (All new papers)
- NEP-EEC-2005-11-19 (European Economics)
- NEP-INT-2005-11-19 (International Trade)
- NEP-TRA-2005-11-19 (Transition Economics)
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