Bun, Maurice J. G.; Klaassen, Franc - 2004
To study the effect of the euro on international goods trade one typically estimates a panel model for the level of … explain the upward trend. To correct for that, we extend the panel model (a gravity model) by including a time trend that may … of between 5% and 40% shrink to a statistically insignificant 3%. For comparison, the estimated trade effects of other …