Social and Behavioral Sciences Commons^™

Hub-And-Spoke Or Else? Free Trade Agreements In The 'Enlarged' European Union, Luca De Benedictis, Roberta De Santis, Claudio Vicarelli

Luca De Benedictis

The object of this paper is to estimate if and how the Central European Free Trade Agreement (CEFTA) and the Baltic Free Trade Agreement (BFTA) exerted a significant impact on intra-European trade, effectively reducing the influence of the European Association Agreements (EAs) in shaping the European trade structure has a hub-and-spoke system – with the EU15 being the hub and the CEECs the spoke. This paper analyses bilateral trade flows between eight CEECs and EU-23. We estimate a gravity equation using a system GMM dynamic panel data approach. Results support the assumptions that gravity forces and “persistence effects” matter. With …

Three Decades Of Italian Comparative Advantages, Luca De Benedictis

Luca De Benedictis

The paper explores the structure of Italian Revealed Comparative Advantages (RCA), focusing on the export structure itself, on its changes over time and on its degree of persistence. The analysis is developed with the use of visual statistical tools and nonparametric statistical techniques that allow to estimate the empirical distribution of the Balassa (1965) Index, and to track its dynamics during three decades, from the 1970s to present. The main results of the analysis are that the structure of Italian RCA is highly persistent, but is changing; the structure is very different when it is examined at a macro-regional level; …

Trade Potentials In Gravity Panel Data Models, Luca De Benedictis, Claudio Vicarelli

Luca De Benedictis

The paper shows how - using as an example the trade flows between eleven European countries and 31 OECD `reporting' countries - the result of a gravity model, in terms of potential trade, changes substantially when country heterogeneity and dynamics are taken into account.

Comparing the in-sample trade potential index derived from various estimators yields three different results: (a) the average trade potential index poorly represents the distribution of yearly trade potentials; (b) the index converges towards the demarcation value corresponding to the equality between observed and predicted trade flows when country heterogeneity and dynamics are taken into account; (c) …

Overall Specialization Empirics: Techniques And Applications, Luca De Benedictis, Massimo Tamberi

Luca De Benedictis

It is customary in the empirical trade literature to analyze specialization patterns of countries using Revealed Comparative Advantage (RCA) measures. This paper explores the informational content of the most commonly used RCA index: the Balassa (1965) Index of RCA.

After describing the properties of the Balassa Index, we propose a research strategy based on descriptive statistics, kernel density estimation, concentration and Markov stationarity methods in order to analyze the dynamics of overall specialization.

Dynamic Scale Economies, Specialization, And The Cost Of The Single Currency, Luca De Benedictis, Piercarlo Padoan

Luca De Benedictis

The paper explores the effect of exchange rate policy, labour market intervention and technological change on the structure of the Ricardian specialization of countries in presence of Economies of scale and learning-by-doing. The model is developed with the EU in mind.