EconPapers    
Economics at your fingertips  
 

Comment: Inferring Trade Costs from Trade Booms and Trade Busts

Guillaume Corlay, Stéphane Dupraz (), Claire Labonne, Anne Muller and Guillaume Daudin ()
Additional contact information
Guillaume Corlay: ENSAE, French National School of Statistics and Economic Administration
Claire Labonne: Paris School of Economics / Université Paris 1 Panthéon Sorbonne – ACPR - Banque de France
Anne Muller: Sciences Po, Observatoire Français des Conjonctures Économiques (OFCE)

No DT/2016/07, Working Papers from DIAL (Développement, Institutions et Mondialisation)

Abstract: Jacks et al. (2011) offer an alternative to price gaps to quantify trade costs. Implementing a method which consists in deducing international trade costs from trade flows, they argue that the reduction in trade costs was the main driving force of trade growth during the first globalization (1870-1913), whereas economic expansion was the main driving force during the second globalization (1950-2000). We argue that this important result is driven by the use of an ad hoc aggregation method. What Jacks et al. (2011) capture is the difference in the relative starting trade of dyads experiencing faster trade growth in the first and second globalization. More generally, we cast doubts on the possibility to reach conclusions of such nature with a method that infers trade costs from trade flows, and then uses these costs to explain trade flows. We argue that it can only rephrase the information already contained in openness ratios.

Keywords: Trade costs; globalization; gravity model; aggregation; structure effect. (search for similar items in EconPapers)
JEL-codes: F14 N70 (search for similar items in EconPapers)
Pages: 12 pages
Date: 2016-08
New Economics Papers: this item is included in nep-his and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.dial.ird.fr/media/ird-sites-d-unites-de ... travail/2016/2016-07 First version, 2016 (application/pdf)

Related works:
Journal Article: Comment: Inferring trade costs from trade booms and trade busts (2017) Downloads
Journal Article: Comment: Inferring trade costs from trade booms and trade busts (2017) Downloads
Working Paper: Comment: Inferring trade costs from trade booms and trade busts (2017)
Working Paper: Comment: Inferring Trade Costs from Trade Booms and Trade Busts (2017) Downloads
Working Paper: Comment: Inferring Trade Costs from Trade Booms and Trade Busts (2016) Downloads
Working Paper: Comment: Inferring Trade Costs from Trade Booms and Trade Busts (2016) 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:dia:wpaper:dt201607

Access Statistics for this paper

More papers in Working Papers from DIAL (Développement, Institutions et Mondialisation) Contact information at EDIRC.
Bibliographic data for series maintained by Loic Le Pezennec ().

 
Page updated 2021-04-04
Handle: RePEc:dia:wpaper:dt201607