ESTIMATING BORDER EFFECTS: THE IMPACT OF SPATIAL AGGREGATION

• 成果类型: Article
• 署名作者: Coughlin, Cletus C.; Novy, Dennis
• 署名单位: Federal Reserve System - USA; University of Warwick
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12520
• 发表日期: 2021
• 页码: 1453-1487
• 关键词: national borders; INTERNATIONAL-TRADE; gravity; frictions; matter; BIAS

摘要

Trade data are typically aggregated across space. In this article, we investigate the sensitivity of gravity estimation to spatial aggregation. We build a model in which micro regions are aggregated into macro regions. We then apply the model to the large literature on border effects in domestic and international trade. Our theory shows that aggregation leads to border effect heterogeneity. Larger regions and countries are systematically associated with smaller border effects. We test our theory with aggregate and industry-level trade flows for U.S. states. Our results confirm the model's predictions, with strong heterogeneity patterns.