The geography of trade in goods and asset holdings

• 成果类型: Article
• 署名作者: Aviat, Antonin; Coeurdacier, Nicolas
• 署名单位: Universite PSL; Ecole Normale Superieure (ENS)
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2006.02.002
• 发表日期: 2007
• 页码: 22-51
• 关键词: Gravity models; International finance; international trade; simultaneous equations

摘要

Gravity models have been widely used to describe bilateral trade in goods. Portes and Rey [Portes, R., Rey, H., 2005. The Determinants of Cross-Border Equity Flows. Journal of International Economics, 65(2), 269-296.] applied this framework to cross-border equity flows and found that distance, which proxies information asymmetries, is a surprisingly very large barrier to cross-border asset trade. We adopt a different point of view and explore the complementarity between bilateral trade in goods and bilateral asset holdings in a simultaneous gravity equations framework. Providing different instruments for both endogenous variables, we show that a 10% increase in bilateral trade raises bilateral asset holdings by 6% to 7%. The reverse causality is also significant, albeit smaller. Controlling for trade, the impact of distance on asset holdings is drastically reduced. (c) 2006 Elsevier B.V. All rights reserved.