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A gravity approach to modelling international trade in south-eastern Europe and the commonwealth of independent states: the role of geography, policy and institutions
Babecká Kucharčuková, Oxana ; Babecký, Jan ; Raiser, Martin
An augmented gravity model is proposed and estimated for a reference group of 82 countries, employing the Poisson and Tobit estimation techniques. Writers find that low quality of economic institutions in the SEE and CIS countries accounted for a considerable proportion of their below-potential international trade. Writers perform policy simulations using institutional data up to 2008 to identify channels for increasing the international trade of the SEE and CIS countries.
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