What Can We Learn from Bilateral Trade? Gravity and Beyond

Much empirical international trade reserach requires a careful analysis of bilateral trade patterns. In this paper we examine a commonly used technique called the gravity equation. Though the use of the gravity equation on aggregate data is well-grounded in monopolistic competition trade theory, we show that central predictions necessary for its derivation can be rejected with simple tests on disaggregated data.

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Year of publication:	1997
Authors:	Haveman, J. ; Hummels, D.
Institutions:	Krannert School of Management, Purdue University
Subject:	INTERNATIONAL TRADE

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Series:	Purdue University, Krannert School of Management - Center for International Business Education and Research (CIBER).
Type of publication:	Book / Working Paper
Notes:	28 pages
Classification:	F14 - Country and Industry Studies of Trade
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005664285