IDEAS home Printed from https://ideas.repec.org/p/zbw/gdec10/32.html
   My bibliography  Save this paper

The Canola Oil Industry and EU Trade Integration: A Gravity Model Approach

Author

Listed:
  • Röttgers, Dirk
  • Faße, Anja
  • Grote, Ulrike

Abstract

Recently biodiesel has become more prominent in countries of the European Union (EU). The rapidly increasing domestic production and consumption of biodiesel is accompanied by increasing trade flows. It is questionable if these trade flows are caused mainly by EU regulations concerning trade or concerning the bioenergy sector. A sector-specific analysis taking industry patterns into consideration is necessary to evaluate the impact of these two policy areas on trade flows. A common way to analyze trade flows is the so-called gravity model, which is employed here. Because of zero-inflated trade data, the model is expanded using the Heckman approach and augmented by spatial weights and Anderson & Van Wincoop's controls for multilateral resistance. The obtained results suggest that while the mandatory biofuel blending quota has a positive impact, investment subsidies cannot be shown to have any effect and trade integration might even have a trade inhibiting effect among EU members. The surprising latter result can be explained by an exhausted domestic European market for raw and intermediate materials for biodiesel and proves stable even when controlling for sector specific variables.

Suggested Citation

  • Röttgers, Dirk & Faße, Anja & Grote, Ulrike, 2010. "The Canola Oil Industry and EU Trade Integration: A Gravity Model Approach," Proceedings of the German Development Economics Conference, Hannover 2010 32, Verein für Socialpolitik, Research Committee Development Economics.
  • Handle: RePEc:zbw:gdec10:32
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/40018/1/306_roettgers.pdf
    Download Restriction: no

    More about this item

    Keywords

    canola; biofuel; gravity model; trade integration;

    JEL classification:

    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:gdec10:32. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics). General contact details of provider: http://edirc.repec.org/data/vfselea.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.