Transport Costs and International Trade

Behar, Alberto; Venables, Anthony J.

doi:10.4337/9780857930873.00011

Cited by 55 publications

(49 citation statements)

References 48 publications

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“…The authors argue that the first phenomenon is the most important one. Finally, Behar and Venables (2009) argue that the non-decreasing coefficient of distance over time is due to increased trade at shorter distances, relative to that at longer distances.…”

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confidence: 99%

Distance and Border Effects in International Trade: A Comparison of Estimation Methods

2016

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This paper compares various estimation methods often used in the estimation of gravity models of international trade. The authors first discuss different structural and consistent estimation techniques, their underlying assumptions and their impact on estimated coefficients. They then estimate the gravity model for global bilateral trade flows using various empirical methodologies. They focus on a comparison of the distance and border effects across estimation techniques. For the border effects they take into account adjacency effects as well as the distinction between intra-regional and inter-regional trade. Their findings confirm the significantly negative distance and the significantly positive adjacency effect across estimation methods, although the size of the effects varies substantially across methods. The border effects by global regions are much more sensitive -both in size and direction -to the applied estimation method. Although all estimation methods have their own merits and drawbacks, the authors provide some guidelines for future empirical research based on their findings.

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confidence: 99%

Distance and Border Effects in International Trade: A Comparison of Estimation Methods

2016

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“…Transport costs are an important part of international trade costs (for a recent review of the role of transport costs in international trade, see, for example, Behar and Venables 2011). Transport infrastructure investment reduces the costs of doing business over distance and thus improves the capacity of firms to compete in global markets.…”

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

“…Both distance and infrastructure quality are proxies for transport costs, and it has been shown that higher transport costs deter trade (Behar and Venables 2011). Overall, falling transport costs have contributed to the increase in international trade over recent decades (Feenstra 1998;Baier and Bergstrand 2001;Behar and Venables 2011). The existing literature on trade, however, has largely focussed on the international dimension of transport costs, while few studies have taken into account the internal geography of countries (Anderson and van Wincoop 2004).…”

Section: Introductionmentioning

confidence: 99%

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Domestic transport infrastructure and firms’ export market participation

2011

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Investment in transport infrastructure reduces the cost of distance and enables firms to establish contacts over larger distances. Using data from a panel of Spanish manufacturing firms and geographic information system techniques, this article studies the impact of domestic transport cost reductions on firms' export market participation, taking into account the role of entry costs and other firm characteristics. We estimate dynamic probability models, controlling for the unobserved heterogeneity of firms and for the simultaneity of firms' export and location decisions. Our results demonstrate a positive effect of domestic transport infrastructure improvements on small and medium-sized firms' probability of exporting.

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“…The empirical evidence provided by international trade literature suggests that the development of transport by sea has been one of the major integration factors in the world economy (Abe and Wilson, 2009;Behar and Venables, 2010;Hummels, 2007;Limão and Venables, 2001). It is often said that the costs of road transport are much higher than the costs of maritime transport, and it can be inferred that the territories with access to the sea have advantages over non-coastal territories.…”

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confidence: 99%

Islands in Trade: Disentangling Distance from Border Effects

2014

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Trade between regions separated by a sea border is affected by specific transport costs that have not been considered by the border effects literature. Among these are the existence of a time barrier, the need to combine different transport modes, or to pay fees and taxes for the use of public infrastructures such as ports and airports. The empirical strategy used to estimate the "island effect" proceeds in two steps: first an augmented gravity model is estimated for mainland and island regions; then a Blinder-Oaxaca decomposition is applied to the gravity estimation results in order to disentangle the distance and border effects for those regions. Results show that island regions are at a substantial disadvantage compared to continental regions, which is due to the higher and non-linear effect of distance coefficients.

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Transport Costs and International Trade

Cited by 55 publications

References 48 publications

Distance and Border Effects in International Trade: A Comparison of Estimation Methods

Distance and Border Effects in International Trade: A Comparison of Estimation Methods

Domestic transport infrastructure and firms’ export market participation

Islands in Trade: Disentangling Distance from Border Effects

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