TRADE POTENTIAL IN AN ENLARGED EUROPEAN UNION: A RECENT APPROACH

Enrique Martinez-Galan (), Maria Paula Fontoura and Isabel Proença ()

International Trade from University Library of Munich, Germany

Abstract: This paper aims to evaluate the trade potential of manufactured products between the members of the EU25 in the threshold of its Eastern enlargement. We estimate, for 2002, a cross-section gravity model, whose coefficients will be used to project the “natural” trade relations between them. Relatively to previous evaluations of trade potential, we include in the gravity model a variable related to the countries’ complementarities in terms of their Commodity Composition of Trade and we opt for a Poisson Pseudo-Maximum Likelihood Estimator. The latter is confronted with the OLS estimator normally used in this type of models.

Keywords: European Union to 25 members; Trade Potential; Gravity Model; Poisson Pseudo-Maximum Likelihood Estimator; Commodities Composition of Trade in Manufactures. (search for similar items in EconPapers)
JEL-codes: C31 C51 C52 F14 F15 F17 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2005-08-31
Note: Type of Document - pdf; pages: 31
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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https://econwpa.ub.uni-muenchen.de/econ-wp/it/papers/0508/0508011.pdf (application/pdf)

Related works:
Working Paper: Trade Potential in an Enlarged European Union: A Recent Approach (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpit:0508011

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