Aggregravity: estimating gravity models from aggregate data

Badinger, H. & Crespo Cuaresma, J. (2015). Aggregravity: estimating gravity models from aggregate data. Applied Economics 47 (20) 2119-2126. 10.1080/00036846.2014.1002903.

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This article considers alternative methods to estimate econometric models based on bilateral data when only aggregate information on the dependent variable is available. Such methods can be used to obtain an indication of the sign and magnitude of bilateral model parameters and, more importantly, to decompose aggregate into bilateral data, which can then be used as proxy variables in further empirical analyses. We perform a Monte Carlo study and carry out a simple real world application using intra-EU trade and capital flows, showing that the methods considered work reasonably well and are worthwhile being considered in the absence of bilateral data.

Item Type: Article
Uncontrolled Keywords: aggregation; gravity equations; C13; F14; F17
Research Programs: World Population (POP)
Bibliographic Reference: Applied Economics; 47(20):2119-2126 (January 2015)
Depositing User: IIASA Import
Date Deposited: 15 Jan 2016 08:53
Last Modified: 27 Aug 2021 17:39

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