Australia's global trade potential: evidence from the gravity model analysis

Rahman, Mohammad Mafizur (2010) Australia's global trade potential: evidence from the gravity model analysis. International Journal of Business Research, 10 (2). pp. 242-253. ISSN 1554-5466; 1555-1296

Abstract

This paper attempts to investigate trade potential for Australia using the augmented gravity models and cross section data of 50 countries. Ordinary Least Square (OLS) has been used as an estimation technique for 2001 and 2005 data. The estimated coefficients from the gravity models are then used to predict Australia's trade potential. Our results reveal that Australia's bilateral trade is affected positively by economic size, per capita GDP, openness and common language, and negatively by the distance between the trading partners. The estimated results show that Australia has tremendous trade potential with Singapore, Argentina, the Russian Federation, Portugal, Greece, Chile, the Philippines, Norway, Brazil and Bangladesh.


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Item Type: Article (Commonwealth Reporting Category C)
Refereed: Yes
Item Status: Live Archive
Additional Information: Copyright Academy of International Business and Economics.
Depositing User: Dr Mafiz Rahman
Faculty / Department / School: Historic - Faculty of Business - School of Accounting, Economics and Finance
Date Deposited: 15 Sep 2010 05:49
Last Modified: 24 Feb 2012 07:28
Uncontrolled Keywords: gravity model; cross-section data; Australia; trade potential
Fields of Research (FOR2008): 15 Commerce, Management, Tourism and Services > 1503 Business and Management > 150308 International Business
14 Economics > 1402 Applied Economics > 140210 International Economics and International Finance
14 Economics > 1403 Econometrics > 140302 Econometric and Statistical Methods
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/8704

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