Economic Analysis Of Asean Free Trade Area; By A Country Panel Data
AbstractThis paper is an attempt to use the Hausman-Taylor (HT) estimation to examine the determinants of trade flows of Asean Free Trade Area (AFTA). Based on the two-way error component form of the gravity model, we employ the HT technique to estimate export flows by a country panel data of 39 countries for the period 1988-2002. The estimations have shown the following important results. Firstly, export flows among two countries increase more proportionately with GDPs. More interestingly, trade is higher between countries of identical preferences than those of different ones. Secondly, the most crucial result is that AFTA has only produced the trade creation among its members. Finally, this study suggests the importance of trade facilitation policy to support the targets of FTA.
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Bibliographic InfoPaper provided by Osaka University, Graduate School of Economics and Osaka School of International Public Policy (OSIPP) in its series Discussion Papers in Economics and Business with number 05-12.
Length: 23 pages
Date of creation: May 2005
Date of revision:
AFTA; gravity models; panel data; trade.;
Find related papers by JEL classification:
- F1 - International Economics - - Trade
- F15 - International Economics - - Trade - - - Economic Integration
- C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-06-05 (All new papers)
- NEP-INT-2005-06-05 (International Trade)
- NEP-SEA-2005-06-05 (South East Asia)
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