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Western Balkan’s trade with the EU and CEFTA-2006: Evidence from Macedonian data


  • Mojsoska-Blazevski, Nikica
  • Petreski, Marjan


The objective of this paper is to empirically examine the determinants of bilateral trade of Macedonia, with particular emphasis on the trade with the EU and CEFTA-2006 countries. The standard Gravity model is used to measure the determinants of the bilateral trade in a panel framework. Results suggest that Macedonian GDP per capita and foreign GDP per capita play significant role in explaining bilateral trade. When Macedonian trade with EU is investigated only, then domestic income has larger magnitude than compared to the entire sample. Importantly, no additional gains have been approximated from FTAs and from CEFTA-2006, in particular. Potential explanation of this can be the still existent non-tariff barriers across the SEE countries, in terms of the technical, sanitary and phyto-sanitary barriers to trade, the time and costs to export and import, improvement of infrastructure related to trade and so on.

Suggested Citation

  • Mojsoska-Blazevski, Nikica & Petreski, Marjan, 2010. "Western Balkan’s trade with the EU and CEFTA-2006: Evidence from Macedonian data," MPRA Paper 41942, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:41942

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    References listed on IDEAS

    1. 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.
    2. Matthieu Bussière & Jarko Fidrmuc & Bernd Schnatz, 2005. "Trade Integration of Central and Eastern European Countries: Lessons from a Gravity Model," Working Papers 105, Oesterreichische Nationalbank (Austrian Central Bank).
    3. Edward F. Buffie, 1992. "On the Condition for Export-Led Growth," Canadian Journal of Economics, Canadian Economics Association, vol. 25(1), pages 211-225, February.
    4. Edward Christie, 2001. "Potential Trade in Southeast Europe: A Gravity Model Approach," wiiw Balkan Observatory Working Papers 11, The Vienna Institute for International Economic Studies, wiiw.
    5. Juan Carlos Hallak & Jagadeesh Sivadasan, 2009. "Firms' Exporting Behavior under Quality Constraints," Working Papers 09-13, Center for Economic Studies, U.S. Census Bureau.
    6. Judith A. Giles, & Cara L. Williams, 1999. "Export-led Growth: A Survey of the Empirical Literature and Some Noncausality Results," Econometrics Working Papers 9901, Department of Economics, University of Victoria.
    7. Sarafidis, Vasilis & Yamagata, Takashi & Robertson, Donald, 2009. "A test of cross section dependence for a linear dynamic panel model with regressors," Journal of Econometrics, Elsevier, vol. 148(2), pages 149-161, February.
    8. Xu, Zhenhui, 1996. "On the Causality between Export Growth and GDP Growth: An Empirical Reinvestigation," Review of International Economics, Wiley Blackwell, vol. 4(2), pages 172-184, June.
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    Cited by:

    1. Jelena Trivic & Łukasz Klimczak, 2015. "The determinants of intra-regional trade in the Western Balkans," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics, vol. 33(1), pages 37-66.
    2. repec:tuz:journl:v:14:y:2016:i:2:p:33-43 is not listed on IDEAS

    More about this item


    bilateral trade; Gravity model; Macedonia; non-tariff barriers;

    JEL classification:

    • P33 - Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Relations, and Aid
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • F10 - International Economics - - Trade - - - General


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