Structural Gravity and Trade Agreements: Does the Measurement of Domestic Trade Matter?

Campos, Rodolfo G.; Timini, Jacopo; Muñoz, Elena Vidal

doi:10.2139/ssrn.3847753

Cited by 9 publications

(6 citation statements)

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“…The finding that intranational trade data are important for estimating the effects of FTAs is in line with several recent contributions in the literature, for example, Dai et al (2014) and Baier et al (2019). More recently, Campos et al (2021) study the implications of using different methods to construct domestic trade flows (e.g. using input-output data versus using gross output data) for the gravity FTA estimates, and they confirm the result that the estimates of FTAs increase once domestic trade flows are explicitly taken into account.…”

Section: Estimation Results and Analysissupporting

confidence: 84%

“…More recently, Campos et al . (2021) study the implications of using different methods to construct domestic trade flows (e.g. using input–output data versus using gross output data) for the gravity FTA estimates, and they confirm the result that the estimates of FTAs increase once domestic trade flows are explicitly taken into account.…”

Section: Estimation Results and Analysismentioning

confidence: 62%

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Gravity Estimations with Interval Data: Revisiting the Impact of Free Trade Agreements

2021

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We challenge the common practice of estimating gravity equations with interval or averaged data in order to capture dynamic-adjustment effects to trade-policy changes. Instead, we point to a series of advantages of using consecutive-year data recognizing dynamic-adjustment effects. Our analysis reveals that, relative to interval or averaged data, the use of consecutive-year data avoids downward-biased effect estimates due to the distribution of trade-policy events during an event window as well as due to anticipation (preinterval) and delayed (post-interval) effects, and it improves the efficiency of effect estimates due to the use of more data.

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Section: Estimation Results and Analysissupporting

confidence: 84%

Section: Estimation Results and Analysismentioning

confidence: 62%

Gravity Estimations with Interval Data: Revisiting the Impact of Free Trade Agreements

2021

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“…Campos et al. (2021) also confirm this result when domestic trade flows are constructed using GDP data or I–O links instead of data on gross production.…”

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confidence: 77%

“…The main advantages of using gross production data over relying on I–O links are (i) wider country coverage and (ii) wider sectoral coverage. Campos et al (2021) offer a review of the different methods to construct domestic trade flows and study the implications for gravity estimates.…”

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confidence: 99%

On the role of domestic trade flows for estimating the gravity model of trade

Yotov

2022

Contemporary Economic Policy

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The gravity equation is the workhorse model of trade. Despite solid theoretical foundations and clear gains from theory-consistent policy analysis, there are still gaps between gravity theory and empirics. This paper focuses on domestic trade flows, and I argue that there are significant benefits from adhering to theory by estimating gravity equations with domestic (in addition to international) trade flows. I review the related literature and synthesize 15 arguments for using domestic trade flows in gravity estimations. The analysis reveals the need for further theory contributions and new data developments, and points to opportunities for more policy applications.

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“…En consecuencia, propuso, para medir los efectos de la distancia respecto de los costos, la inclusión del comercio intrapaís, hallando evidencia a favor de la reducción de los costos internacionales con relación a los internos, en el contexto de la globalización económica. Estudios posteriores ratifican esta evidencia (Agnosteva et al, 2019;Campos et al, 2021) y rediscuten las implicancias de utilizar datos de comercio doméstico (Yotov, 2022).…”

Section: Los Factores Explicativos Del Intercambio Comercial En Las A...unclassified

Los fundamentos conceptuales del modelo gravitacional de comercio: una revisión de la literatura

Lacaze

2022

Estud. econ

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El trabajo reseña el estado de la literatura referida al modelo gravitacional de comercio, su utilidad práctica y sus microfundamentos, cuyo explicitación permitió la incorporación de esta herramienta a la corriente principal de pensamiento de la economía internacional. Los aportes conceptuales en este campo del conocimiento han permitido derivar la ecuación gravitacional desde enfoques que postulan distintos tipos de modelos de equilibrio general; asumiendo diferentes estructuras de mercado y diversos grados de heterogeneidad entre firmas de la industria considerada. La literatura aplicada sobre el tema da cuenta de la existencia de una frondosa discusión referida a las fricciones vinculadas a la distancia geográfica entre países, que cobra particular interés en el contexto actual de globalización.

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Structural Gravity and Trade Agreements: Does the Measurement of Domestic Trade Matter?

Cited by 9 publications

References 0 publications

Gravity Estimations with Interval Data: Revisiting the Impact of Free Trade Agreements

Gravity Estimations with Interval Data: Revisiting the Impact of Free Trade Agreements

On the role of domestic trade flows for estimating the gravity model of trade

Los fundamentos conceptuales del modelo gravitacional de comercio: una revisión de la literatura

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