Constraints on Trade in the MENA region

Author/Editor:

Hirut Wolde ; Rina Bhattacharya

Publication Date:

February 1, 2010

Electronic Access:

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Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

In this paper we estimate gravity models to see whether trade volumes of countries in the MENA region are significantly lower than what would be expected given their economic, cultural and geographical characteristics. Our empirical results show that the variables used in standard gravity models cannot explain a significant part of MENA's trade performance, particularly on exports. We then go on to 'augment' the standard gravity model with relevant variables from the World Bank's Business Enterprise surveys. Our results further show that these variables, and in particular transport constraints and inefficiencies in customs clearance processes, are important in explaining the MENA region's underperformance in trade.

Series:

Working Paper No. 10/31

Subject:

English

Publication Date:

February 1, 2010

ISBN/ISSN:

9781451962604/1018-5941

Stock No:

WPIEA2010031

Price:

$18.00 (Academic Rate:$18.00)

Format:

Paper

Pages:

19

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