{"title":"Determinants of bilateral trade flow between Ethiopia and its major trading partners: A gravity model approach","authors":"Firomsa Mersha Tekalign, A. Mehare","doi":"10.53936/afjare.2022.17(4).24","DOIUrl":null,"url":null,"abstract":"This study seeks to identify the internal and external factors determining Ethiopia’s bilateral exports and total trade flows. It uses panel data covering 21 major trading partners of Ethiopia from 2000 to 2017 and estimates an augmented fixed effects gravity model. The results reveal that domestic and foreign revenues increase Ethiopia’s bilateral exports, whereas the country’s foreign direct investment and the population size of the trading partners decrease bilateral exports. The results further show that both the domestic and foreign income and similarity endowment of Ethiopia increase the country’s total trade. The study provides recommendations for the effective implementation of supply side policies to enhance trade.","PeriodicalId":45228,"journal":{"name":"African Journal of Agricultural and Resource Economics-AFJARE","volume":null,"pages":null},"PeriodicalIF":0.4000,"publicationDate":"2022-12-31","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":"0","resultStr":null,"platform":"Semanticscholar","paperid":null,"PeriodicalName":"African Journal of Agricultural and Resource Economics-AFJARE","FirstCategoryId":"1085","ListUrlMain":"https://doi.org/10.53936/afjare.2022.17(4).24","RegionNum":0,"RegionCategory":null,"ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":null,"EPubDate":"","PubModel":"","JCR":"Q4","JCRName":"AGRICULTURAL ECONOMICS & POLICY","Score":null,"Total":0}
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Abstract
This study seeks to identify the internal and external factors determining Ethiopia’s bilateral exports and total trade flows. It uses panel data covering 21 major trading partners of Ethiopia from 2000 to 2017 and estimates an augmented fixed effects gravity model. The results reveal that domestic and foreign revenues increase Ethiopia’s bilateral exports, whereas the country’s foreign direct investment and the population size of the trading partners decrease bilateral exports. The results further show that both the domestic and foreign income and similarity endowment of Ethiopia increase the country’s total trade. The study provides recommendations for the effective implementation of supply side policies to enhance trade.
期刊介绍：
The African Journal of Agricultural and Resource Economics (AfJARE)/Journal Africain d’Economie Agricole et des Ressources (JAEAR) is a publication of the African Association of Agricultural Economists (AAAE). The journal publishes original research about how African agriculture interacts with local and global economic systems and policy regimes in its impacts upon people. The scope of the journal covers the roles of markets, technology, policy, institutions and the natural environment in shaping the lives of well being of Africans engaged in agricultural activities. The journal strives to nurture and enhance the capacity of African professionals to conduct and publish scientific research and provides a venue for communicating and disseminating their findings. Multi-disciplinary, problem-oriented articles are encouraged. Submissions may deal with teaching, research extension, consulting, advising, entrepreneurship and administration. The Chief Editors and Editorial Board, under the general direction of the AAAE President, Executive Committee and Council are charged with implementing Journal policy to serve members of AAAE. The main section of the journal publishes technical research articles while a small section is devoted to publishing brief notes with important policy content and book reviews. The journal is a quarterly publication.
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