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Bilateral Trade Balance of Bangladesh with BRICS Countries: A Static Panel Data Analysis

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  • Kundu, Nobinkhor

Abstract

This paper explores the phenomenon of gravity modeling to examine the crucial relationships between the trade balances of Bangladesh with BRICS countries. Specifically, the relative factors determining trade in the popular gravity model have effects on the trade balance model. The trade balance depends on the relative GDP, relative per capita GNI, real exchange rate and import-weighted distance proxies for transportation cost of the partner countries to the home country. Using standard panel data techniques during the 1991-2013 period, the model is empirically tested and the results show significant effects of all the relative factors on the bilateral trade balance of Bangladesh in trading with BRICS countries. The robustness check of the model ensures the validity of the specification. The static panel data analysis explores the cross-country variations as well as the time-invariant country-specific effects on trade balance with heterogeneous economies and finds significant effects of all relative factors on the trade balance of Bangladesh.

Suggested Citation

  • Kundu, Nobinkhor, 2015. "Bilateral Trade Balance of Bangladesh with BRICS Countries: A Static Panel Data Analysis," MPRA Paper 66091, University Library of Munich, Germany, revised 03 Aug 2015.
    • Handle: RePEc:pra:mprapa:66091
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    References listed on IDEAS

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    Cited by:

    1. Hossain, Ekram & Dechun, HUANG & ZHANG, Changzheng & Neequaye, Ebenezer Nickson & Van, Vu Thi & Ali, Mohammad, 2021. "Trade Deficit of Bangladesh with China: Patterns, Propensity and Policy Implications," OSF Preprints 7j9vh, Center for Open Science.
    2. Redwanur Rahman & Saleh Shahriar & Sokvibol Kea, 2019. "Determinants of Exports: A Gravity Model Analysis of the Bangladeshi Textile and Clothing Industries," FIIB Business Review, , vol. 8(3), pages 229-244, September.

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    More about this item

    Keywords

    Bilateral Trade; BRICS; Panel Data Model;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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