Tkachuk, Oleksandr and Popko, Denis (2007): On the patterns of trade convergence in European transition countries.
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In current study we analyze the convergence of trade between Central and Eastern European countries (CEECs) and European Union (EU) during the period from 1984 to 2004. In our extension of the theoretical framework of Helpman, Melitz and Rubinstein (2005) with heterogeneous firms we discuss the influence of economic fundamentals and trade cost on extensive and intensive margins of trade. Then, we use gravity model of trade to calculate potentials for CEECs trade with EU-15 countries. As a result, we develop convergence measures for CEECs exports and imports trade flows with EU-15. Moreover, we provide decomposition of trade flows on extensive and intensive margins, and construct convergence measures for each of the trade components. Finally, we analyze the mechanics of trade convergence process in selected CEECs. Current paper contributes to better understanding of trade convergence patterns in European transition countries, providing policy-makers in transition economies with useful insights on the role of different trade components in the convergence process.
|Item Type:||MPRA Paper|
|Original Title:||On the patterns of trade convergence in European transition countries|
|English Title:||On the patterns of trade convergence in European transition countries|
|Keywords:||trade convergence, gravity model, extensive and intensive margins, Hummels-Klenow decomposition|
|Subjects:||F - International Economics > F1 - Trade > F15 - Economic Integration
C - Mathematical and Quantitative Methods > C2 - Single Equation Models; Single Variables > C23 - Models with Panel Data; Longitudinal Data; Spatial Time Series
F - International Economics > F1 - Trade > F17 - Trade Forecasting and Simulation
|Depositing User:||Oleksandr Tkachuk|
|Date Deposited:||17. Mar 2009 04:54|
|Last Modified:||15. Feb 2013 12:06|
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