Asymmetries in Heterogeneous Integrated Areas: Evidence from Intra-EU Sectoral Trade
This paper estimates gravity models for both directions of trade between the EU-15 and the CEEC-10. The two groups form a heterogeneous integrated area (EU-27) with respect to country size, income levels, relative factor endowments and a different history of economic systems. The estimation was conducted on industries with different degrees of scale economies and factor-intensities in the presence of both spatial (distance and borders) and non-spatial (Eastern enlargements and Euro membership) trade costs. The results highlight the asymmetry in intra-bloc trade when the latter is heterogeneous: country size, income, factor endowments and the various trade barriers or facilitators are found to be significant determinants of intra-EU trade but to an extent that is country and industry-specific. The results also show how this heterogeneity eliminates the equivalence between exports and imports as the dependent variable in gravity models and makes the results sensitive to the definition of the bilateral flows to be estimated.
|Date of creation:||2008|
|Date of revision:|
|Contact details of provider:|| Web page: http://www.infer-research.net/|
More information through EDIRC
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.:
- Henriksen, E & Knarvik, K.H.M. & Steen, F., 2001.
"Economies of Scale in European Manufacturing Revisited,"
12/2001, Norwegian School of Economics and Business Administration-.
- Henriksen, Espen & Steen, Frode & Ulltveit-Moe, Karen-Helene, 2001. "Economies of Scale in European Manufacturing Revisited," CEPR Discussion Papers 2896, C.E.P.R. Discussion Papers.
- Donald R. Davis & David E. Weinstein, 1997.
"Economic Geography and Reginal Production Structure: An Empirical Investigation,"
NBER Working Papers
6093, National Bureau of Economic Research, Inc.
- Davis, Donald R. & Weinstein, David E., 1999. "Economic geography and regional production structure: An empirical investigation," European Economic Review, Elsevier, vol. 43(2), pages 379-407, February.
- Donald R. Davis & David E. Weinstein, 1997. "Economic Geography and Regional Production Structure: An Empirical Investigation," Harvard Institute of Economic Research Working Papers 1802, Harvard - Institute of Economic Research.
- Donald R. Davis & David E. Weinstein, 1998. "Economic geography and regional production structure: an empirical investigation," Staff Reports 40, Federal Reserve Bank of New York.
- Yener Kandogan, 2008. "Falling walls and lifting curtains: analysis of border effects in transition countries," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 17(1), pages 85-104.
- Christos Papazoglou & Eric J. Pentecost & Helena Marques, 2006. "A Gravity Model Forecast of the Potential Trade Effects of EU Enlargement: Lessons from 2004 and Path-dependency in Integration," The World Economy, Wiley Blackwell, vol. 29(8), pages 1077-1089, 08.
- Helena Marques, 2008. "Trade And Factor Flows In A Diverse Eu: What Lessons For The Eastern Enlargement(S)?," Journal of Economic Surveys, Wiley Blackwell, vol. 22(2), pages 364-408, 04.
- Laszlo Matyas, 1997. "Proper Econometric Specification of the Gravity Model," The World Economy, Wiley Blackwell, vol. 20(3), pages 363-368, 05.
- Paul Grauwe & Frauke Skudelny, 2000. "The impact of EMU on trade flows," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 136(3), pages 381-402, 09.
- Davis, Donald R. & Weinstein, David E., 2003. "Market access, economic geography and comparative advantage: an empirical test," Journal of International Economics, Elsevier, vol. 59(1), pages 1-23, January.
- Fratianni, Michele & Kang, Heejoon, 2006. "Heterogeneous distance-elasticities in trade gravity models," Economics Letters, Elsevier, vol. 90(1), pages 68-71, January.
- Andrew K. Rose, 2000. "One money, one market: the effect of common currencies on trade," Economic Policy, CEPR;CES;MSH, vol. 15(30), pages 7-46, 04.
- Robert C. Feenstra & James R. Markusen & Andrew K. Rose, 2001. "Using the gravity equation to differentiate among alternative theories of trade," Canadian Journal of Economics, Canadian Economics Association, vol. 34(2), pages 430-447, May.
When requesting a correction, please mention this item's handle: RePEc:inf:wpaper:2008.2. 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: (Christian Richter)
If references are entirely missing, you can add them using this form.