Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/89346 
Year of Publication: 
2011
Series/Report no.: 
LEM Working Paper Series No. 2011/25
Publisher: 
Scuola Superiore Sant'Anna, Laboratory of Economics and Management (LEM), Pisa
Abstract: 
This paper investigates whether the gravity model (GM) can explain the statistical properties of the International Trade Network (ITN). We fit data on international-trade flows with a GM specification using alternative fitting techniques and we employ GM estimates to build a weighted predicted ITN, whose topological properties are compared to observed ones. Furthermore, we propose an estimation strategy to predict the binary ITN with a GM. We find that the GM successfully replicates the weighted-network structure of the ITN, only if one fixes its binary architecture equal to the observed one. Conversely, the GM performs very badly when asked to predict the presence of a link, or the level of the trade flow it carries, whenever the binary structure must be simultaneously estimated.
Subjects: 
International Trade Network
Gravity Equation
Weighted Network Analysis
Topological Properties
Econophysics
JEL: 
F10
D85
Document Type: 
Working Paper

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