A Gravity Model for Components of Imports

This paper develops a gravity model to explain different components of imports. It is shown that specific variables from competing trade theories affect each component differently: As economic sizes or relative factor endowments become similar, the volume of intra-industry imports, especially that of its horizontal component increases. Furthermore, the typical variables of an extended gravity model have different impact on each component: Colonial relations are important determinants of inter-industry imports whereas cultural proximity based on religion and language plays a more crucial role in determining intra-industry imports. Overall, the significance of these different effects suggests that the proposed decomposition of imports into its components removes a widespread but unnecessary restriction in the gravity models.


Issue Date:
2009-04
Publication Type:
Journal Article
PURL Identifier:
http://purl.umn.edu/143222
Published in:
Review of Applied Economics, Volume 05, Number 1-2
Page range:
99-115
Total Pages:
17
JEL Codes:
F10; F14
Series Statement:
Vol.5
No.1-2




 Record created 2017-04-01, last modified 2017-04-28

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