International fragmentation of production and economic integration change the structure of international trade. Novel datasets reveal how production processes are unbundled across borders and connected internationally through Global Value Chains (GVCs). Yet, the impact of Economic Integration...

Our paper deals with econometric developments for the estimation of the gravity model which lead to convergent parameter estimates even when a correlation exists between the explanatory variables and the specific unobservable characteristics of each unit. We implement panel data econometric...

We suggest that bilateral gravity equations augmented by ad hoc measures of absolute supply-side country differences are misspecified. Building on Haveman and Hummels (2004), we develop and test an alternative specification rooted in incomplete specialization that views bilateral gravity...