A Gravity Model for Components of Imports
This paper develops a gravity model to explain different components of imports. It is shown that specific variables from competing trade theories affect each component differently: As economic sizes or relative factor endowments become similar, the volume of intra-industry imports, especially that of its horizontal component increases. Furthermore, the typical variables of an extended gravity model have different impact on each component: Colonial relations are important determinants of inter-industry imports whereas cultural proximity based on religion and language plays a more crucial role in determining intra-industry imports. Overall, the significance of these different effects suggests that the proposed decomposition of imports into its components removes a widespread but unnecessary restriction in the gravity models.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Gros, Daniel & Gonciarz, Andrzej, 1996. "A note on the trade potential of Central and Eastern Europe," European Journal of Political Economy, Elsevier, vol. 12(4), pages 709-721, December.
- Schüler, Martin Kurt, 1995. "On Intra-Industry Trade in Intermediates," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 48(1), pages 67-84.
- Simon J. Evenett & Wolfgang Keller, 1996.
"On Theories Explaining the Success of the Gravity Equation,"
9608001, EconWPA, revised 13 Jun 1997.
- Simon J. Evenett & Wolfgang Keller, 2002. "On Theories Explaining the Success of the Gravity Equation," Journal of Political Economy, University of Chicago Press, vol. 110(2), pages 281-316, April.
- Evenett, S. J. & Keller, W., 1994. "On Theories Explaining the Success of the Gravity Equation," Working papers 9713, Wisconsin Madison - Social Systems.
- Simon J. Evenett & Wolfgang Keller, 1998. "On Theories Explaining the Success of the Gravity Equation," NBER Working Papers 6529, National Bureau of Economic Research, Inc.
- Robert Feenstra, 2003.
"Integration Of Trade And Disintegration Of Production In The Global Economy,"
986, University of California, Davis, Department of Economics.
- Robert C. Feenstra, 1998. "Integration of Trade and Disintegration of Production in the Global Economy," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 31-50, Fall.
- Robert C. Feenstra, "undated". "Integration Of Trade And Disintegration Of Production In The Global Economy," Department of Economics 98-06, California Davis - Department of Economics.
- Rauch, James E., 1999.
"Networks versus markets in international trade,"
Journal of International Economics,
Elsevier, vol. 48(1), pages 7-35, June.
- Barry Eichengreen & Douglas A. Irwin, 1996.
"The Role of History in Bilateral Trade Flows,"
NBER Working Papers
5565, National Bureau of Economic Research, Inc.
- Balassa, Bela & Bauwens, Luc, 1987. "Intra-industry Specialisation in a Multi-country and Multi-industry Framework," Economic Journal, Royal Economic Society, vol. 97(388), pages 923-939, December.
- Anderson, James E, 1979. "A Theoretical Foundation for the Gravity Equation," American Economic Review, American Economic Association, vol. 69(1), pages 106-116, March.
- Helpman, Elhanan, 1981. "International trade in the presence of product differentiation, economies of scale and monopolistic competition : A Chamberlin-Heckscher-Ohlin approach," Journal of International Economics, Elsevier, vol. 11(3), pages 305-340, August.
- Laszlo Matyas, 1997. "Proper Econometric Specification of the Gravity Model," The World Economy, Wiley Blackwell, vol. 20(3), pages 363-368, 05.
- Wang, Z.K. & Winters, L.A., 1992.
"The Trading Potential of Eastern Europe,"
92-21, Department of Economics, University of Birmingham.
- Robert C. Shelburne, 2002. "Bilateral Intra-Industry Trade in a Multi-Country Helpman-Krugman Model," International Economic Journal, Taylor & Francis Journals, vol. 16(4), pages 53-73.
- Peter Egger & Michael Pfaffermayr, 2003. "The proper panel econometric specification of the gravity equation: A three-way model with bilateral interaction effects," Empirical Economics, Springer, vol. 28(3), pages 571-580, July.
- James E. Anderson & Eric van Wincoop, 2001.
"Gravity with Gravitas: A Solution to the Border Puzzle,"
NBER Working Papers
8079, National Bureau of Economic Research, Inc.
- James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
- James E. Anderson & Eric van Wincoop, 2000. "Gravity with Gravitas: A Solution to the Border Puzzle," Boston College Working Papers in Economics 485, Boston College Department of Economics.
- Feenstra, Robert C, 2002. "Border Effects and the Gravity Equation: Consistent Methods for Estimation," Scottish Journal of Political Economy, Scottish Economic Society, vol. 49(5), pages 491-506, December.
- Bergstrand, Jeffrey H, 1985. "The Gravity Equation in International Trade: Some Microeconomic Foundations and Empirical Evidence," The Review of Economics and Statistics, MIT Press, vol. 67(3), pages 474-481, August.
- Helpman, Elhanan, 1987. "Imperfect competition and international trade: Evidence from fourteen industrial countries," Journal of the Japanese and International Economies, Elsevier, vol. 1(1), pages 62-81, March.
- Y. Kandogan, 2003. "Reconsidering the adjustment costs of the Europe agreements," Applied Economics Letters, Taylor & Francis Journals, vol. 10(2), pages 63-68.
When requesting a correction, please mention this item's handle: RePEc:ags:reapec:143222. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.