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Gravity, distance, and international trade

In: Handbook of International Trade and Transportation

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  • Scott L. Baier
  • Amanda Kerr
  • Yoto V. Yotov

Abstract

The authors review and interpret the main theoretical developments in the gravity literature from its very early, a-theoretical applications to the latest structural contributions. They also discuss challenges and implement methods to estimate empirical gravity equations. They finish with a presentation and examples of numerical simulations with the structural gravity model. Throughout the analysis they attempt to emphasize the links and importance of transportation costs for the trade literature, and outline avenues where they believe interdisciplinary contributions between the international trade and transportation economics fields will be most valuable.

Suggested Citation

  • Scott L. Baier & Amanda Kerr & Yoto V. Yotov, 2018. "Gravity, distance, and international trade," Chapters, in: Bruce A. Blonigen & Wesley W. Wilson (ed.), Handbook of International Trade and Transportation, chapter 2, pages 15-78, Edward Elgar Publishing.
    • Handle: RePEc:elg:eechap:17028_2
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    10. Mario Larch & Yoto Yotov, 2017. "On the impact of TTIP in Southeastern and Eastern Europe: A quantitative analysis," Economic Thought journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 3, pages 54-73,74-92.
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    More about this item

    Keywords

    Economics and Finance;

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F17 - International Economics - - Trade - - - Trade Forecasting and Simulation
    • R40 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics - - - General

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