Estimating the elasticity of trade: the trade share approach

Research, Preprint OPEN
Mauro Lanati;
  • Publisher: Scuola Superiore Sant'Anna, Laboratory of Economics and Management (LEM) Pisa
  • Subject: F10 | F11 | gravity model | competitiveness equation | F14 | trade share | trade cost elasticity | trade cost elasticity; gravity model; competitiveness equation; trade share; gains from international trade | trade cost elasticity, gravity model, competitiveness equation, trade share,gains from international trade. | gains from international trade
    • jel: jel:F11 | jel:F10 | jel:F14
      ddc: ddc:330

Recent theoretical work on international trade emphasizes the importance of trade elasticity as the fundamental statistic needed to conduct welfare analysis. Eaton and Kortum (2002) proposed a two-step method to estimate this parameter, where exporter fixed effects are ... View more
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