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The determinants of intra-industry trade in the tourism services

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  • Leitão, Nuno Carlos

Abstract

Purpose- This manuscript examines the determinants of intra-industry trade (IIT) in the tourism services by Portugal. The trade in this sector between Portugal and 17 countries was examined between 2002 and 2009. Design/methodology/approach- The paper formulates theoretical hypothesis that may explain the intra-industry trade in the tourism services. These hypotheses are tested using a dynamic panel data analysis. Findings- The result show that intra-industry trade occurs more frequently among countries that are similar in terms of factor endowments. The economic dimension and border confirm the positive impact in IIT. Our results also show that intra-industry trade increases if transportation costs decrease. Originality of the research-This article confirms relevant theoretical hypotheses on the causes of intra-industry trade. The results obtained with the Arellano and Bond GMM system estimator suggest that the building of dynamic theoretical models will be of interest to academic researchers in tourism services.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 37444.

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Date of creation: 19 Mar 2012
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Handle: RePEc:pra:mprapa:37444

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Keywords: Intra-industry trade; tourism services; dynamic panel data; Portugal;

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  1. R Blundell & Steven Bond, . "Initial conditions and moment restrictions in dynamic panel data model," Economics Papers W14&104., Economics Group, Nuffield College, University of Oxford.
  2. Richard Blundell & Steve Bond, 1999. "GMM estimation with persistent panel data: an application to production functions," IFS Working Papers, Institute for Fiscal Studies W99/04, Institute for Fiscal Studies.
  3. Arellano, Manuel & Bond, Stephen, 1991. "Some Tests of Specification for Panel Data: Monte Carlo Evidence and an Application to Employment Equations," Review of Economic Studies, Wiley Blackwell, Wiley Blackwell, vol. 58(2), pages 277-97, April.
  4. Hummels, D. & Levinsohn, J., 1993. "Monopolistic Competition and International Trade: Reconsidering the Evidence," Working Papers, Research Seminar in International Economics, University of Michigan 339, Research Seminar in International Economics, University of Michigan.
  5. Windmeijer, Frank, 2005. "A finite sample correction for the variance of linear efficient two-step GMM estimators," Journal of Econometrics, Elsevier, Elsevier, vol. 126(1), pages 25-51, May.
  6. Nuno Carlos Leitão & Horácio C. Faustino & Yushi Yoshida, 2010. "Fragmentation, Vertical Intra-Industry Trade, and Automobile components," Economics Bulletin, AccessEcon, vol. 30(2), pages 1006-1015.
  7. M Arellano & O Bover, 1990. "Another Look at the Instrumental Variable Estimation of Error-Components Models," CEP Discussion Papers, Centre for Economic Performance, LSE dp0007, Centre for Economic Performance, LSE.
  8. Rudolf Loertscher & Frank Wolter, 1980. "Determinants of intra-industry trade: Among countries and across industries," Review of World Economics (Weltwirtschaftliches Archiv), Springer, Springer, vol. 116(2), pages 280-293, June.
  9. Krugman, Paul R., 1979. "Increasing returns, monopolistic competition, and international trade," Journal of International Economics, Elsevier, Elsevier, vol. 9(4), pages 469-479, November.
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