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The Determinants of Bangladesh's Trade: Evidence from the Generalized Gravity Model

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  • Rahman, Mohammad Mafizur

Abstract

The application of the generalized gravity model in analyzing the Bangladesh's trade reveals that Bangladesh's trade is positively determined by the size of the economies, per capita GNP differential of the countries involved and openness of the trading countries. Bangladesh's exports are positively determined by the exchange rate, partner countries' total import demand and openness of the Bangladesh economy. Bangladesh's imports are determined by inflation rates, per capita income differentials, openness of the countries involved in trade and the border between India and Bangladesh. Multilateral resistance factors and transportation costs affect Bangladesh's trade positively and negatively respectively.

Suggested Citation

  • Rahman, Mohammad Mafizur, 2005. "The Determinants of Bangladesh's Trade: Evidence from the Generalized Gravity Model," Working Papers 3, University of Sydney, School of Economics.
    • Handle: RePEc:syd:wpaper:2123/7634
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    Cited by:

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    2. Norehan Abdullah & Hussin Abdullah & Hadi M. Othman Abuhriba, 2014. "The Determinants of Trade and Trade Direction of Arab Maghreb Union (AMU)," Journal of Empirical Economics, Research Academy of Social Sciences, vol. 2(2), pages 46-62.
    3. Cardamone, Paola, 2007. "A Survey of the Assessments of the Effectiveness of Preferential Trade Agreements using Gravity Models," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 60(4), pages 421-473.
    4. Sandeep KAUR* & Parmjit NANDA**, 2011. "An Analysis of Actual and Potential Exports of Pakistan with SAARC Countries:A Panel Data Analysis," Pakistan Journal of Applied Economics, Applied Economics Research Centre, vol. 21, pages 69-91.
    5. Sultan, Maryam & Munir, Kashif, 2015. "Export, Import and Total Trade Potential of Pakistan: A Gravity Model Approach," MPRA Paper 66621, University Library of Munich, Germany.
    6. Sayeeda Bano, 2010. "ASEAN-New Zealand Trade Relations and Trade Potential," Working Papers in Economics 10/01, University of Waikato.

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