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Lerner meets Gravity

Author

Listed:
  • Joseph Francis Francois
  • Miriam Manchin

    (UCL School of Slavonic and East European Studies)

Abstract

We examine the linkages between import policy and export performance, extending classic macroeconomic trade effects to more recent concepts from the modern literature on gravity models. We also examine these effects empirically with a panel of global and bilateral trade spanning 15 years. Our emphasis on the role of import policy (i.e. tariffs) of exporters as an explanation of trade volumes contrasts with the recent emphasis on importer policy in the gravity literature. It also reinforces the growing body of evidence on the importance of economic environmental (policy and infrastructure) conditions in explaining relative export performance.

Suggested Citation

  • Joseph Francis Francois & Miriam Manchin, 2013. "Lerner meets Gravity," UCL SSEES Economics and Business working paper series 123, UCL School of Slavonic and East European Studies (SSEES).
    • Handle: RePEc:see:wpaper:2013:123
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    File URL: http://discovery.ucl.ac.uk/1390728/1/LernerJanuary2013.pdf
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    References listed on IDEAS

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    1. Baier, Scott L. & Bergstrand, Jeffrey H., 2009. "Bonus vetus OLS: A simple method for approximating international trade-cost effects using the gravity equation," Journal of International Economics, Elsevier, vol. 77(1), pages 77-85, February.
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    More about this item

    Keywords

    policy and aggregate exports; Lerner symmetry; gravity model;
    All these keywords.

    JEL classification:

    • F40 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - General
    • F68 - International Economics - - Economic Impacts of Globalization - - - Policy
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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