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Estimating Bulgaria's Trade Borders with the EU An Application of the Empirical Gravity Model of Trade

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  • Iliev, Dragomir

    (Tsenov Academy of Economics)

  • Stefanov, Galin

    (Tsenov Academy of Economics)

  • Yotov, Yoto

    (School of Economics)

Abstract

We use the empirical gravity model of international trade to evaluate the borders in manufacturing trade between Bulgaria and the European Union (BG-EU). Our results suggest that in 2006 the BG-EU border was quite large and not statistically different from the average border in our sample of 69 countries. As expected, our estimates confirm that the trade border between Bulgaria and the EU members was very large, and much larger than the average sample border, before the collapse of communism. The border fell sharply in the early to mid-90s, but it followed the average sample trend since then. We also document weak asymmetries in the BG-EU border in favor of EU exports to Bulgaria. Our results point to a series of extensions and further analysis.

Suggested Citation

  • Iliev, Dragomir & Stefanov, Galin & Yotov, Yoto, 2017. "Estimating Bulgaria's Trade Borders with the EU An Application of the Empirical Gravity Model of Trade," School of Economics Working Paper Series 2017-2, LeBow College of Business, Drexel University.
  • Handle: RePEc:ris:drxlwp:2017_002
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    References listed on IDEAS

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    More about this item

    Keywords

    Bulgarian Trade Border with EU; Structural Gravity; Integration;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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