Gravity model and efficiency of trade between China and EU countries: Visegrad group, Germany, Austria
| Název práce v češtině: | Gravitační model a efektivita obchodu mezi Čínou a zeměmi EU: Visegradská skupina, Německo a Rakousko |
|---|---|
| Název v anglickém jazyce: | Gravity model and efficiency of trade between China and EU countries: Visegrad group, Germany, Austria |
| Klíčová slova: | Gravitační model, Analýza stochastické hranice, mezinárodní obchod, Čína, EU, Visegrad |
| Klíčová slova anglicky: | Gravity model, Stochastic frontier analysis, International trade, China, EU, Visegrad |
| Akademický rok vypsání: | 2015/2016 |
| Typ práce: | diplomová práce |
| Jazyk práce: | angličtina |
| Ústav: | Institut ekonomických studií (23-IES) |
| Vedoucí / školitel: | doc. Ing. Vladimír Benáček, CSc. |
| Řešitel: | skrytý - zadáno vedoucím/školitelem |
| Datum přihlášení: | 16.06.2016 |
| Datum zadání: | 16.06.2016 |
| Datum a čas obhajoby: | 13.09.2017 08:30 |
| Místo konání obhajoby: | Opletalova - Opletalova 26, O206, Opletalova - místn. č. 206 |
| Datum odevzdání elektronické podoby: | 25.07.2017 |
| Datum proběhlé obhajoby: | 13.09.2017 |
| Oponenti: | doc. Petr Janský, M.Sc., Ph.D. |
| Kontrola URKUND: | |
| Zásady pro vypracování |
| According to the IES standards for master theses. |
| Seznam odborné literatury |
| Anderson, J. E. & van Wincoop, E. (2003). Gravity with Gravitas: A Solution to the Border Puzzle. American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
Anderson, J. E. & Yotov Y. V. (2010). The Changing Incidence of Geography. American Economic Review, American Economic Association, vol. 100(5), pages 2157-86, December. Armstrong S. (2007). Measuring Trade and Trade Potential: A Survey. Asia Pacific Economic Papers 368, Australia-Japan Research Centre, Crawford School of Public Policy, The Australian National University. Elteto, A. & Szunomar, A. (2016) "Chinese investment and trade - strengthening ties with Central and Eastern Europe," International Journal of Business and Management, International Institute of Social and Economic Sciences, vol. 4(1), pages 24-48, February. Ravishankar, G. & Stack, M. M. (2014). The Gravity Model and Trade Efficiency: A Stochastic Frontier Analysis of Eastern European Countries' Potential Trade. The World Economy, Wiley Blackwell, vol. 37(5), pages 690-704, 05. Silva, S. & Tenreyro, S. (2006). "The Log of Gravity," The Review of Economics and Statistics, MIT Press, vol. 88(4), pages 641-658, November. Tamini, L., Chebbi, H. E. & Abbassi, A. (2016). Trade performance and potential of North African countries: An application of a stochastic frontier gravity model. Create Working Paper, 2016-4, Center for Research on the economics of the Environment, Agri-food, Transport and Energy |
| Předběžná náplň práce |
| Topic characteristics: The objective of this paper is to analyze the bilateral trade between China and the Visegrad group, Austria, and Germany. The analysis employs gravity model; apart analyzing individual countries, I analyze also the development of the crucial variables in the model. Then I estimate efficiency scores to analyze whether any differences exist between old and new EU members. Economic performance is directly connected to trade efficiency, therefore sound analysis of the trade performance can lead to improvements in the economies and contribution to the GDP growth. Analysis should reveal how well the market works and what the main restrictions are, thus it should enables us to offer solutions to reduce costs and inefficiencies.
Thanks to the Iron Curtain Fall, unprecedented growth potential opened for the Visegrad countries; still lacking behind the core EU countries, Visegrad is expected to grow more dynamically than the old EU states. Similarly, the Asian region has been experiencing wild development since 1990s. Moreover, China is becoming one of the world's leaders and the largest economy in the world. With such rise in importance and with new opportunities to grow, the analysis aims to reveal how well China and V4 capture the opportunities and what the main impediments are. Hypotheses: 1. Trade flows between V4 and China increased after the V4's accession to EU. 2. Germany exhibits different trading pattern vis-a-vis China than V4. 3. Trade efficiency exhibits increasing trend over the examined period. Methodology: The analysis will be conducted on the yearly data from 1995 to the most recent observation. As my primary sources, I will use IMF database. For the gravity model estimation, I intend to use linear estimation technique - fixed effects, thus I need to use log transform the data. Silva and Tenreyro (2006) suggest that log transformation may lead to biased estimates under some conditions. If my data fulfills the conditions, I will have to employ different approach such as Poisson pseudo-maximum likelihood estimator. Lastly, I will employ stochastic frontier analysis as it is used in Ravishankar & Stack (2014) and Tamini et al. (2016) for the estimation of efficiency scores. Expected Contribution: Inter alia, Elteto and Szunomar (2016) suggest that trade between East Asia and Visegrad is growing in importance; however it is not clear whether such increase is due to improvement in trade efficiency or due to the different factors. This thesis aims to answers it. The thesis expands existing literature by analyzing both cross-sectional aspect and time-series one with clear focus on Visegrad group and comparison with more developed economies - Austria, Germany. Further, I analyze development of the variables employed in the gravity model, which provides additional perspective. I provide analysis of the given countries with the knowledge of the estimates obtained from the gravity model and from the stochastic frontier analysis. Inter alia, Ravishankar & Stack (2014) focus on efficiency of trade of V4 to other Europeans markets, but it has been done little research in direction to trade with China, other than just simple analysis of the trade data. This thesis offers comprehensive analysis of V4-China trade. Outline: 1. Introduction 2. Literature Review (a) Gravity models in general (b) Stochastic frontier analysis 3. Description of examined countries (a) The Visegrad Group, Germany, Austria (b) China 4. Data & Methodology 5. Results (a) Trade efficiency (b) Robustness check (b) Suggestions for further improvement 6. Conclusion |
| Předběžná náplň práce v anglickém jazyce |
| Topic characteristics: The objective of this paper is to analyze the bilateral trade between China and the Visegrad group, Austria, and Germany. The analysis employs gravity model; apart analyzing individual countries, I analyze also the development of the crucial variables in the model. Then I estimate efficiency scores to analyze whether any differences exist between old and new EU members. Economic performance is directly connected to trade efficiency, therefore sound analysis of the trade performance can lead to improvements in the economies and contribution to the GDP growth. Analysis should reveal how well the market works and what the main restrictions are, thus it should enables us to offer solutions to reduce costs and inefficiencies.
Thanks to the Iron Curtain Fall, unprecedented growth potential opened for the Visegrad countries; still lacking behind the core EU countries, Visegrad is expected to grow more dynamically than the old EU states. Similarly, the Asian region has been experiencing wild development since 1990s. Moreover, China is becoming one of the world's leaders and the largest economy in the world. With such rise in importance and with new opportunities to grow, the analysis aims to reveal how well China and V4 capture the opportunities and what the main impediments are. Hypotheses: 1. Trade flows between V4 and China increased after the V4's accession to EU. 2. Germany exhibits different trading pattern vis-a-vis China than V4. 3. Trade efficiency exhibits increasing trend over the examined period. Methodology: The analysis will be conducted on the yearly data from 1995 to the most recent observation. As my primary sources, I will use IMF database. For the gravity model estimation, I intend to use linear estimation technique - fixed effects, thus I need to use log transform the data. Silva and Tenreyro (2006) suggest that log transformation may lead to biased estimates under some conditions. If my data fulfills the conditions, I will have to employ different approach such as Poisson pseudo-maximum likelihood estimator. Lastly, I will employ stochastic frontier analysis as it is used in Ravishankar & Stack (2014) and Tamini et al. (2016) for the estimation of efficiency scores. Expected Contribution: Inter alia, Elteto and Szunomar (2016) suggest that trade between East Asia and Visegrad is growing in importance; however it is not clear whether such increase is due to improvement in trade efficiency or due to the different factors. This thesis aims to answers it. The thesis expands existing literature by analyzing both cross-sectional aspect and time-series one with clear focus on Visegrad group and comparison with more developed economies - Austria, Germany. Further, I analyze development of the variables employed in the gravity model, which provides additional perspective. I provide analysis of the given countries with the knowledge of the estimates obtained from the gravity model and from the stochastic frontier analysis. Inter alia, Ravishankar & Stack (2014) focus on efficiency of trade of V4 to other Europeans markets, but it has been done little research in direction to trade with China, other than just simple analysis of the trade data. This thesis offers comprehensive analysis of V4-China trade. Outline: 1. Introduction 2. Literature Review (a) Gravity models in general (b) Stochastic frontier analysis 3. Description of examined countries (a) The Visegrad Group, Germany, Austria (b) China 4. Data & Methodology 5. Results (a) Trade efficiency (b) Robustness check (b) Suggestions for further improvement 6. Conclusion |