The paper introduces for the most frequently used three-dimensional panel data sets several random effects model specifications. It derives appropriate estimation methods for the balanced and unbalanced cases. An application is also presented where the bilateral trade of 20 EU countries is...

This paper studies linearized spatial structural gravity models of bilateral trade à la Behrens, Ertur and Koch (2012). We show that these models do in fact not require spatial econometric methods for estimation. This result follows from the nature of the specific spatial weights matrix, and...

This paper tests the implication of the Stolper-Samuelson theorem that capital-poor individuals prefer more trade openness in poor (capital-scarce) countries and less trade in rich (labor-scarce) countries, by using a broad panel of countries and new exogenous determinants of trade openness....

The study examines the long-run relationship between trade, FDI and GDP growth in the East Asia region employing panel integration and cointegration techniques for a dynamic heterogeneous panel of 20 East Asian countries over the period 1980 to 2007. The paper also explores the long-run impact...

If the Euro has boosted intra Euro-Area trade, what exactly in the new currency is responsible for such an effect? Most explanations focus on a decrease in exchange rate volatility or in transaction costs, receiving mixed empirical support. After briefly surveying the relevant literature, this...

This study examines the effect of independent exchange rate pursuits and reserve holdings, relative to other determinants, on global export performance of WAMZ countries. The regression results show that exports originating from the Zone to the rest of the world are influenced positively by...

This paper is an attempt to use the Hausman-Taylor (HT) estimation to examine the determinants of trade flows of Asean Free Trade Area (AFTA). Based on the two-way error component form of the gravity model, we employ the HT technique to estimate export flows by a country panel data of 39...

Traditional trade models ignoring the dimension of product quality generally lead to excessively low trade price elasticities. In this paper, we show that higher estimated trade price elasticities, more in conformity with theory, can be obtained by controlling product quality in trade equations....

The issue of digital piracy is a hot button among governments around the world. Piracy rates may significantly affect both internal and international trade of cultural goods. This paper aims to empirically assess the effect of digital piracy on bilateral trade in cultural goods. We focus on...

This paper investigates the effect of corruption on trade openness in low-income and high-income countries. The results suggest corruption is anti-labor, since it reduces trade in low-income countries and increases trade in high-income countries.