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Why Do Estimates of the EMU Effect On Trade Vary so Much?

Listed author(s):
  • Andrew K. Rose

Larger data sets, with more countries and a longer span of time, exhibit systematically larger effects of European monetary union on trade. I establish this stylized fact with meta-analysis and confirm it by estimating a plain-vanilla gravity model. I then explain this finding by examining systematic biases in “multilateral resistance to trade” manifest in time-varying country fixed effects; bias grows as the sample is truncated by dropping small poor countries.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 22678.

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Date of creation: Sep 2016
Publication status: published as Andrew K. Rose, 2017. "Why do Estimates of the EMU Effect on Trade Vary so Much?," Open Economies Review, Springer, vol. 28(1), pages 1-18, February.
Handle: RePEc:nbr:nberwo:22678
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