GRAVITY MODELING: INTERNATIONAL TRADE AND R&D

Dushko Josheski () and Risto Fotov

MPRA Paper from University Library of Munich, Germany

Abstract: In this paper issue of gravity modeling in international trade has been investigated. Standard gravity equation augmented with other variables to control for transportation cost, whether trade partners are neighbors and whether country is landlocked, or countries participants in trade have had colonial history together. Also in our model we control whether traded commodities are homogenous, differentiated or high tech, as well referenced. Variable to denote technology are: TAI index, which stands for technological achievement index, also variables for creation and diffusion of technology, as measured by the number of patents from the residents and royalty and license fees receipts, by the foreign citizens. Results are as expected and the show that trade is highly dependent on the exporters and importers levels of technology.

Keywords: Key words: bilateral trade; gravity model; R&D; OLS; PPML (search for similar items in EconPapers)
JEL-codes: F1 F14 (search for similar items in EconPapers)
Date: 2013-03-26
New Economics Papers: this item is included in nep-ino, nep-int, nep-ipr, nep-pr~ and nep-knm
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:45550

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