Egger, Peter; Pfaffermayr, Michael - In: Empirical Economics 28 (2003) 3, pp. 571-580
We argue that the proper specification of a panel gravity model should include main (exporter, importer, and time) as well as time invariant exporter-by-importer (bilateral) interaction effects. In a panel of 11 APEC countries, the latter are highly significant and account for the largest part...