Chapter 1
Partial equilibrium trade policy analysis with structural gravity

In this chapter, you will learn:

  • how the structural gravity model is derived
  • where to find the data needed to estimate econometrically the structural gravity model
  • where to find the data needed to estimate econometrically the structural gravity model
  • what are the main measurement issues associated with gravity data
  • what are the main econometric issues associated with the estimation of the structural gravity
    model and how to address them
  • how to econometrically estimate the structural gravity model
  • how to interpret and consistently aggregate gravity estimates.

After reading this chapter, with good econometric knowledge, and familiarity with STATA, you will
be able to estimate using STATA software a theoretically-consistent structural gravity model and
assess the effects of trade policies (and other determinants) on bilateral trade, while interpreting
the econometric results with key caveats in mind.

| Read Chapter 1 | Install application files | Download application files |