Evaluating Asian Free Trade Agreements: What Does Gravity Model Tell Us?

Sunder Ramaswamy, Abishek Choutagunta and Santosh Kumar Sahu

Foreign Trade Review, 2021, vol. 56, issue 1, 60-70

Abstract: This paper evaluates the performance of Free Trade Agreements (FTAs) by analysing the determinants of trade flows of Asian economies for a panel of 31 countries during 2007–2014 using a Gravity model. The estimated results suggest that certain FTAs negatively contribute to trade flows across the region and, that GDP and population, among other factors, can explain total trade flows. This study also finds that trade costs using distance as a proxy has a significant and negative effect on trade. Our results are in-line with the expectations which can be drawn by looking at trends of trade flows in Asia. Thus, a case is attempted for smoothening trade-flows across the region by reducing tariff and non-tariff barriers, pumping in investments on transport infrastructure and improving productivity of the partners as a whole which has positive effects on GDP and thus trade. JEL Codes: F13, F14, C23

Keywords: International trade flows; gravity model; Asia; PPML (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/0015732520961330 (text/html)

Related works:
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:sae:fortra:v:56:y:2021:i:1:p:60-70

DOI: 10.1177/0015732520961330

Access Statistics for this article

More articles in Foreign Trade Review
Bibliographic data for series maintained by SAGE Publications ().