COVID‐19 and the distance effect

Faqin Lin, Mengxun Liu and Mohan Zhou

The World Economy, 2024, vol. 47, issue 3, 1297-1323

Abstract: Using nearly 200 countries' bilateral trade data and the gravity equation, this paper provides evidence that COVID‐19 has led countries to trade more with their closer countries. The negative distance effect is greater during the pandemic period, with a greater number of infected cases, deaths or stricter control policies. A simple model of a transportation sector that was affected by the pandemic was built to explain our empirical findings.

Date: 2024
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