Exploring Australia's global trade potential: a gravity approach with panel data

Rahman, Mohammad Mafizur (2012) Exploring Australia's global trade potential: a gravity approach with panel data. Academy of Taiwan Business Management Review, 8 (1). pp. 35-47. ISSN 1813-0534

Official URL: http://www.jtiba.com

Abstract

This paper investigates Australia's global trade potential taking data of Australia and its 57 trading partners for the period of 1972-2006. Gravity model approach and panel data estimation techniques have been used. The paper first estimates the augmented gravity models of trade. The estimated coefficients are then used to predict Australia's trade potential. Our results reveal that Australia's bilateral trade is affected positively by income, openness of trading partners, common language and free trade agreement, and negatively by the per capita income differential and distance between Australia and trading partners. The results indicate Australia has notable trade potential with Mexico, Argentina, Uruguay, Austria, Peru, India, the Philippines, Brazil, Chile, the USA, New Zealand, Greece, Japan, Turkey, Nepal, Kenya, Spain, Hungary, Brunei, Hong Kong, South Africa, Pakistan and Canada.


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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Depositing User: Dr Mafiz Rahman
Faculty / Department / School: Historic - Faculty of Business and Law - School of Accounting, Economics and Finance
Date Deposited: 30 Jul 2012 02:21
Last Modified: 21 Jul 2014 04:00
Uncontrolled Keywords: gravity model; panel data; Australia; trade potential
Fields of Research (FOR2008): 15 Commerce, Management, Tourism and Services > 1503 Business and Management > 150308 International Business
14 Economics > 1403 Econometrics > 140304 Panel Data Analysis
14 Economics > 1402 Applied Economics > 140210 International Economics and International Finance
Socio-Economic Objective (SEO2008): B Economic Development > 91 Economic Framework > 9103 International Trade > 910399 International Trade not elsewhere classified
URI: http://eprints.usq.edu.au/id/eprint/21265

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