The Distance Puzzle: On the Interpretation of the Distance Coefficient in Gravity Equations
Posted: 9 Jul 2004
Abstract
Although globalization has diminished the importance of distance, empirical gravity models find little change in distance coefficients. We argue that changing distance costs are largely reflected in the constant term. A proportional fall in distance costs is consistent with constant distance coefficients.
Keywords: Distance coefficients, Gravity equations, Globalization
JEL Classification: F0, F21
Suggested Citation: Suggested Citation
Buch, Claudia M. and Kleinert, Jörn and Toubal, Farid, The Distance Puzzle: On the Interpretation of the Distance Coefficient in Gravity Equations. Available at SSRN: https://ssrn.com/abstract=562903
Feedback
Feedback to SSRN
If you need immediate assistance, call 877-SSRNHelp (877 777 6435) in the United States, or +1 212 448 2500 outside of the United States, 8:30AM to 6:00PM U.S. Eastern, Monday - Friday.