infonet-economy

This paper provides a new theoretically-derived measure of preference margins at the product level, that takes into account competition across exporters as well as competition with domestic producers on a given market. This indicator is derived for differentiated goods under imperfect competition, in a frame-work extended from Ottaviano, Tabuchi and Thisse (2002). We compute our…

Least developed countries (LDCs) hoped that the DOHA round would bring them greater market access in the Organization for Economic Cooperation and Development countries than for non-LDCs. Using HS-6 tariff level data for the United States and the EU for 2004, this paper estimates that, once the erosion from preferential access into the EU to non-LDCs is taken into account, LDCs have…

Contrary to expectations, evidence of a death of distance has eluded numerous estimations in the popular gravity model of trade: estimates of the coefficient of distance are markedly higher in studies with recent data. This column shows that this is only so for the poorer countries who are trading with geographically closer partners. This regionalization of trade for low-income…

The “distance effect” measuring the elasticity of trade flows to distance has been to be rising since the early 1970s in a host of studies based on the gravity model, leading observers to call it the “distance puzzle”. We review the evidence and explanations. Using an extensive data set of 124 countries over the period 1970-2005, we confirm the existence of this puzzle and identify…