GRAVITY MODELS OF GROSS TRADE AND VALUE-ADDED TRADE – COMPARATIVE ANALYSIS
Abstract
In this article similarities and differences between gravity models of gross trade and gravity models of value-added trade are discussed. Gravity models explaining value-added trade are characterized by the higher determination coefficients than gravity models illustrating gross trade. According to the estimation results, more intensive gross and value-added trade are accompanied by higher exporter’s and importer’s GDP and lower the difference in GDP per capita between trading partners. Additionally, shorter geographic distance, common official language and membership in the same regional trading arrangements are much more important for more intensive gross trade than for value added-trade.
Keywords:
gross trade, value-added trade, gravity modelDetails
- Issue
- Vol. 4 No. 23 (2017)
- Section
- Research article
- Published
- 2017-12-29
- DOI:
- https://doi.org/10.19253/reme.2017.04.014
- Licencja:
-
This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.
This is an Open Access journal, all articles are distributed under the terms of the Creative Commons (CC BY 4.0) License (http://creativecommons.org/licenses/by-nc-sa/4.0/). You must give appropriate credit, provide a link to the license, and indicate if changes were made. You may do so in any reasonable manner, but not in any way that suggests the licensor endorses you or your use. No additional restrictions — You may not apply legal terms or technological measures that legally restrict others from doing anything the license permits.
