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Full-Text Articles in Social and Behavioral Sciences
Gatt/Wto Promotes Trade Strongly: Sample Selection And Model Specification, Xuepeng Liu
Gatt/Wto Promotes Trade Strongly: Sample Selection And Model Specification, Xuepeng Liu
Faculty and Research Publications
Some recent empirical studies examine the impact of the GATT/WTO on trade. This paper investigates the sample selection bias and the gravity model specification issues in the literature. First, the GATT/WTO not only makes existing trading partners trade more at the intensive margin, but also creates new trading relationships at the extensive margin. Most existing papers exclude zero trade observations and hence ignore the extensive margin. Secondly, due to the violation of some maintained assumptions, the traditional log-linear gravity regressions fail to uncover the role of the GATT/WTO even at the intensive margin. Using a large bilateral panel dataset including …
Trade And Income Convergence: Sorting Out The Causality, Xuepeng Liu
Trade And Income Convergence: Sorting Out The Causality, Xuepeng Liu
Faculty and Research Publications
This paper studies the linkage between international trade and income convergence across countries. Different theories offer conflicting predictions regarding how they might affect each other. In the existing empirical literature estimating the trade impact on income convergence, a long-lasting problem is the reverse causality from income convergence to trade. This paper provides a disaggregated bilateral trade data analysis to solve this problem. The results show that the reverse causality from income convergence to trade exists in differentiated product sectors, but not in homogeneous product sectors. Trade in homogeneous sectors reduces the income gaps among trade partners, but it is not …