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

Rahman, Mohammad Mafizur (2010) Exploring Australia's global trade potential: a gravity approach with panel data. In: 6th International Conference of Global Academy of Business & Economic Research, 17-19 Oct 2010, New York, USA.

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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. Providing a theoretical justification for using the gravity model 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: Conference or Workshop Item (Commonwealth Reporting Category E) (Paper)
Refereed: Yes
Item Status: Live Archive
Additional Information: No evidence of copyright restrictions.
Depositing User: Dr Mafiz Rahman
Faculty / Department / School: Historic - Faculty of Business - School of Accounting, Economics and Finance
Date Deposited: 08 Dec 2010 02:18
Last Modified: 29 Feb 2012 01:59
Uncontrolled Keywords: gravity model, panel data, Australia, trade potential
Fields of Research (FOR2008): 14 Economics > 1402 Applied Economics > 140210 International Economics and International Finance
14 Economics > 1403 Econometrics > 140304 Panel Data Analysis
Socio-Economic Objective (SEO2008): B Economic Development > 91 Economic Framework > 9103 International Trade > 910303 Trade Policy
URI: http://eprints.usq.edu.au/id/eprint/9034

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