EconPapers    
Economics at your fingertips  
 

Constrained Poisson pseudo maximum likelihood estimation of structural gravity models

Michael Pfaffermayr

International Economics, 2020, vol. 161, issue C, 188-198

Abstract: This paper reconsiders the estimation of structural gravity models. It introduces a constrained, projection-based Poisson pseudo maximum likelihood estimation procedure (constrained PPML) that exploits the equilibrium conditions introduced by Anderson and Van Wincoop (2003) for estimation and inference. The constrained PPML estimator avoids the estimation of the large number of exporter and importer fixed effects, and provides more reliable inference than the unconstrained PPML estimator. Moreover, based on the delta method the paper drives confidence intervals of counterfactual changes. Monte Carlo simulations yield encouraging results on the performance of the constrained PPML estimator.

Keywords: Constrained Poisson pseudo maximum likelihood estimation; International trade gravity equation structural estimation (search for similar items in EconPapers)
JEL-codes: C13 C50 F10 F15 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S2110701719301842
Full text for ScienceDirect subscribers only

Related works:
Journal Article: Constrained Poisson pseudo maximum likelihood estimation of structural gravity models (2020) Downloads
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:inteco:v:161:y:2020:i:c:p:188-198

DOI: 10.1016/j.inteco.2019.11.014

Access Statistics for this article

International Economics is currently edited by Valerie Mignon and Marcelo Olarreaga

More articles in International Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2025-03-23
Handle: RePEc:eee:inteco:v:161:y:2020:i:c:p:188-198