Preferential attachment, R&D expenditure and the evolution of international trade networks from the perspective of complex networks

Linqing Liu, Mengyun Shen, Da Sun, Xiaofei Yan and Shi Hu

Physica A: Statistical Mechanics and its Applications, 2022, vol. 603, issue C

Abstract: From the perspective of complex networks, whether international trade networks (ITNs) can remain robust and connected in the face of random emergencies or intentional attacks is an important indicator of the security of international trade. Thus, we introduced the scale-free property to describe it. Using trade data from 1996–2018 for 126 economies, we constructed ITNs and investigated their scale-free property. Our results reveal that ITNs are not scale free in most years and that they become decentralized. In addition, our study explored the evolution of ITNs using the temporal exponential random graph model (TERGM) and verified the nonexistence of the preferential attachment mechanism that drives the formation of scale-free networks. Furthermore, we emphasized the impact of different R&D expenditure levels on the formation of trade relationships. Economies with medium (low) levels of R&D expenditures are less connected to those with the same level, while economies with high levels of R&D expenditures prefer to establish trade relationships with those with the same level. This finding indicates that the establishment of trade relationships could occur more often between economies with a high level of R&D expenditures and economies with a medium (low) level of R&D expenditures or among economies with a high level of R&D expenditures. Therefore, economies with a high level of R&D expenditures are more active and attractive when selecting trade partners. Overall, we extend the exploration in the field of ITN research and provide an innovative analysis framework to study real networks.

Keywords: International trade network (ITN); TERGM; Scale-free property; R&D expenditure (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:603:y:2022:i:c:s0378437122004009

DOI: 10.1016/j.physa.2022.127579

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