Subhani, Muhammad Imtiaz and Osman, Ms.Amber and Khokhar, Rabbia (2010): Determinants and barriers to bilateral trade A study on developing economies.
Download (146kB) | Preview
World trade has grown rapidly. Several factors are highlighted by literature as a driving force behind the growth of world trade. Reduction in barriers to trade is one of them. A comprehensive empirical investigation is carried to ascertain the trade reducing and increasing effect of barriers to trade which are also known determinants of trade. The modified gravity model developed in this study analyses the effect of GDP, distance,remittances, FDI, transportation cost, exchange rate, inflation, population, import and export on trade flows. The study revealed that the population, import and transportation cost, distance, Tariff imposed by trading partner, FDI and Population of trading country are the determinants and significantly affect exports of developing economies. The study also ascertain that transportation cost, distance, population of trading partner, FDI of both trading countries and remittances of trading partner are the determinants that have major impact on import of developing nations.
|Item Type:||MPRA Paper|
|Original Title:||Determinants and barriers to bilateral trade A study on developing economies|
|English Title:||Determinants and barriers to bilateral trade A study on developing economies|
|Keywords:||International Trade, Exports, Imports, Gravity Model, Trade barriers|
|Subjects:||F - International Economics > F1 - Trade > F13 - Trade Policy ; International Trade Organizations
F - International Economics > F2 - International Factor Movements and International Business > F23 - Multinational Firms ; International Business
O - Economic Development, Innovation, Technological Change, and Growth > O2 - Development Planning and Policy > O24 - Trade Policy ; Factor Movement Policy ; Foreign Exchange Policy
B - History of Economic Thought, Methodology, and Heterodox Approaches > B2 - History of Economic Thought since 1925 > B22 - Macroeconomics
N - Economic History > N7 - Transport, Trade, Energy, Technology, and Other Services
A - General Economics and Teaching > A1 - General Economics > A10 - General
P - Economic Systems > P3 - Socialist Institutions and Their Transitions > P33 - International Trade, Finance, Investment, Relations, and Aid
R - Urban, Rural, Regional, Real Estate, and Transportation Economics > R4 - Transportation Economics > R41 - Transportation: Demand, Supply, and Congestion ; Travel Time ; Safety and Accidents ; Transportation Noise
M - Business Administration and Business Economics ; Marketing ; Accounting ; Personnel Economics > M2 - Business Economics > M21 - Business Economics
|Depositing User:||Muhammad Imtiaz Subhani|
|Date Deposited:||26. Oct 2010 20:22|
|Last Modified:||06. Apr 2015 20:20|
Baier, S. L., & Bergstrand, J. H. (2001). The Growth of World Trade: Tariffs, Transport Costs, and Income Similarity. Journal of International Economics 53(1), 1-27.
Balassa, B. (1965) .Tariff Protection In Industrial Countries: An Evaluation. Journal of Political Economy, 63, 573-94.
Balassa, B. (1982). Development Strategies in Semi -industrial Economies. Washington, DC: Johns Hopkins University Press.
Baldwin, R., & Lewis, W. E. (1978). U.S. Tariff Effects on Trade and Employment in Detailed SIC Industries: The Impact of International Trade on Investment and Employment . Washington: U.S. Department of Labor.
Basevi, G. (1966). The United States Tariff Structure: Estimates of Effective Rates of Protection of United States Industries and Industrial Labour. The Review of Economics and Statistics, 48, 147-160.
Bayoumi, T., & Eichengreen, B. (1997). Is Regi onalism Simply a Diversion? Evidence from the EU and EFTA. In Ito, T. and A. Kreuger (ed.), Regionalism versus Multilateral Trade Arrangements . Chicago: The University of Chicago Press.
Beghin, J.C., & Bureau, J.C. (2001). Quantitative Policy Analysis of Sanitary, Phytosanitary and Technical Barriers to Trade. Economie International, 88, 107-130. Bhagwati, J. (1988). Protectionism. Cambridge, MA: The MIT Press.
Cline, W. R., Kawanabe, N., Kronsjo, T. O. M., & Williams, T. (1978). Trade Negotiations in the Tokyo Round: A Quantitative Assessment. Washington: Brookings Institute . Corden, W.M. (1966). The Structure of a Tariff System and The Effective Protective Rate. Journal of Political Economy, 74, 221-37. Corden, W.M. (1971). The Substitution Problem in th e Theory of Effective Protection. Journal of International Economics, 1(1) , 37-57.
Deardorff, A. V. (1984). Testing Trade Theories and Predicting Trade Flows . In: R. W. Jones and P. B. Kenen (ed.). Handbook of International Economics, 467-517.
Deardorff, A. V. (1998). Determinants Of Bilateral Trade: Does Gravity Work In A Neoclassical World?.In Frankel, J. A. (ed.). The Regionalization of the World Economy. University of Chicago for NBER: Chicago, 7-22.
Deardorff, A. V., & Stem, R. (1986). The Michigan Model of World Production and Trade: Theory and Applications. Cambridge, MA: The MIT Press .
Feenstra, R.C. (1992). How Costly is Protectionism?. Journal of Economic Perspectives, 6, 159-178.
Feenstra, R.C. (1998). Integration of Trade and Disintegration of Production in the Global Economy .Journal of Economic Perspectives , 31-50.
Frankel, J. A., Romer, D., & Cyrus, T. L. (1996 ). Trade and Growth in East Asian Countries: Cause and Effect?. National Bureau of Economic Research, 5732.
Frankel, J., & Romer, D. (1996). Trade and Growth : An Empirical Investigation. National Bureau of Economic Research, 5476.
Gonzales, M. V., Bailes, J. C., & Amano, M. M. (1991). A Multidimensional Approach to Unders tanding Non-Tariff Trade Barriers. American Economic Review, 69-76.
Hansberg, E. R. (2005). A Spatial Theory of Trade. American Economic Review, 95(5), 1464-1491.
Harrigan, J. (1993). OECD Imports and Trade Barriers in 1983. Journal of International Economics, 35, 91-111.
Helpman, E. (1987). Imperfect Competition and International Trade : Opening Remarks . European Economic Review, 31(1-2), 77-81.
Hummels, D. (2007). Transportation Costs and International Trade in the Second Era of Globalization .Journal of Economic Perspectives, 21(3), 152-3.
Hummels, D., & Levinsohn, J. (1995). Monopolistic Competition and International Trade: Reconsidering The Evidence. Quarterly Journal of Economics, 110, 799-836.
Irwin, D.A. (1997). Changing the Course of U. S. Trade Policy in the 1930’s. National Bureau of Economic Research.
Kristjánsdóttir, H. (2005). What Drives Sector Allocation of Foreign Direct Investment in Iceland.Education Policy Research Unit , 05-08.
Krugman, P. R. (1995). America in The World Economy: Understanding the Misunderstandings . Japan and the World Economy, Elsevier, 7(2), 233-247.
Krugman, P. R. (1995). Growing World Trade: Causes and Consequences . Brookings Papers on Economic Activity, 26(1), 327-377.
Krugman, P. R. (2002). Was it All in Ohlin?A Centennial Celebration. MIT Press, Cambridge (MA), 1899-1999.
Lai, H., & Zhu, S. (2004). The Determinants of Bilateral Trade. Canadian Journal of Economics , 37 (2), 459-483.
Leamer, E. E. (1990). Latin America n as a Target for Trade Barriers Erected by Major Developed Countries in 1983. Joumal of Development Economics , 32, 337-368.
Determinants and Barriers to Bilateral Trade 17 Poyhonen, P (1963). A Tentative Model for the Volume of Trade between Countries.
Weltwertschaftliches Archiv, 90, 93-100. Rauch, J. E (1999). Networks Versus Markets in International Trade. Journal of International Economics, 48, 7-35.
Ray, E. (1981). Tariff and Non-tariff Barriers to Trade in the United States and Abroad. Review of Economics and Statistics, 63, 161-168.
Romer, P. (1994). New Goods, Old Theory and the Welfare Cost of Trade Restrictions. Journal of Development Economics, 43, 5-38.
Sanso, M., Cuairan, R., & Sanz, F. (1993). Bilateral Trade Flows, the Gravity Equation, and Functional Form. Review of Economics and Statis tics, 75, 266-275.
Tinbergen, J., (1962). Shaping The World Economy. Twentieth Century Fund, New York .
Trefler, D. (1993). Trade Liberalization and the Theory of Endogenous Protection: An Econometric Study of US Import Policy. Journal of Political Economy, 101(1), 138-60.
United Nations, (2008). Trade and Development Report 2008. UNCTAD, Geneva.
Waters, W.G. (1970). Transportation Costs, Tariffs, and the Pattern of Industrial Protection. American Economic Review, 60, 1013-20.
World Trade Organization. (2007). Six Decades Of Multilateral Trade Cooperation: What Have We Learnt?. World Trade Report 2007.