Gravity model of trade: the case of Serbia

Thesis title: Gravity model of trade: the case of Serbia
Author: Lazarević, Marina
Thesis type: Diploma thesis
Supervisor: Šíma, Ondřej
Opponents: Pour, Jiří
Thesis language: English
Abstract:
The main objective of this thesis is to examine the major factors of Serbia’s foreign trade in order to estimate the export and import functions. The analysis is based on the gravity model of international trade. The panel dataset includes 40 countries for a ten year period from 2006 to 2015 which derives 400 observations. The estimation is done based on the pooled OLS, random and fixed effects models. The results of the Breush-Pagan test shows that the estimation results of the random effects model are the most appropriate. The results reveal that the economic size, both of Serbia and its trading partners, distance, similar language and free trade agreements have a major impact on Serbia’s trade. On the other hand, a common border appears insignificant. Furthermore, the export potential is calculated for all trading partners included in this research. The trade with most of the countries seems to be under or near to its potential.
Keywords: gravity model; random effects ; international trade ; Serbia
Thesis title: Gravity model of trade: the case of Serbia
Author: Lazarević, Marina
Thesis type: Diplomová práce
Supervisor: Šíma, Ondřej
Opponents: Pour, Jiří
Thesis language: English
Abstract:
The main objective of this thesis is to examine the major factors of Serbia’s foreign trade in order to estimate the export and import functions. The analysis is based on the gravity model of international trade. The panel dataset includes 40 countries for a ten year period from 2006 to 2015 which derives 400 observations. The estimation is done based on the pooled OLS, random and fixed effects models. The results of the Breush-Pagan test shows that the estimation results of the random effects model are the most appropriate. The results reveal that the economic size, both of Serbia and its trading partners, distance, similar language and free trade agreements have a major impact on Serbia’s trade. On the other hand, a common border appears insignificant. Furthermore, the export potential is calculated for all trading partners included in this research. The trade with most of the countries seems to be under or near to its potential.
Keywords: random effects ; Serbia; international trade ; gravity model

Information about study

Study programme: Finance and Accounting
Type of study programme: Magisterský studijní program
Assigned degree: Ing.
Institutions assigning academic degree: Vysoká škola ekonomická v Praze
Faculty: Faculty of Finance and Accounting
Department: Department of Monetary Theory and Policy

Information on submission and defense

Date of assignment: 30. 6. 2017
Date of submission: 21. 12. 2018
Date of defense: 16. 1. 2019
Identifier in the InSIS system: https://insis.vse.cz/zp/62587/podrobnosti

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