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Article

The Structural Gravity Model and Its Implications on Global Forest Product Trade

Thuenen Institute of International Forestry and Forest Economics, Leuschnerstraße 91, 21031 Hamburg, Germany
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Forests 2020, 11(2), 178; https://doi.org/10.3390/f11020178
Received: 30 December 2019 / Revised: 22 January 2020 / Accepted: 3 February 2020 / Published: 5 February 2020
(This article belongs to the Section Forest Economics, Policy, and Social Science)
The gravity model of trade is one of the most common approaches in modern econometrics. In its basic form, the model assumes that income and distance between two partners most likely play a major role in the occurrence of trade. Despite the long history of the gravity model and its high, universal explanatory potential, its application for the forest sector is not broad and refers only to the traditional definition of the gravity approach. However, this traditional approach is not able to explain all aspects of trade at a disaggregated sector level. Consequently, the present study aims to close this research gap and reveal influencing factors for the appearance and the intensity of forest product trade by applying the structural gravity approach. This is done via linear and non-linear estimation methods for the forest sector on the whole and for thirteen forest products in detail. Three major results were found: first, the traditional gravity approach overestimates the impact of the overall income on forest sector trade. Second, the appearance of wood market trade is not always influenced by the same factors as the quantity traded. Third, with increasing processing level, determinants of forest product trade seem to be influenced by different factors. View Full-Text
Keywords: gravity model; wood markets; forest products; bilateral trade; PPML estimator gravity model; wood markets; forest products; bilateral trade; PPML estimator
MDPI and ACS Style

Morland, C.; Schier, F.; Weimar, H. The Structural Gravity Model and Its Implications on Global Forest Product Trade. Forests 2020, 11, 178. https://doi.org/10.3390/f11020178

AMA Style

Morland C, Schier F, Weimar H. The Structural Gravity Model and Its Implications on Global Forest Product Trade. Forests. 2020; 11(2):178. https://doi.org/10.3390/f11020178

Chicago/Turabian Style

Morland, Christian, Franziska Schier, and Holger Weimar. 2020. "The Structural Gravity Model and Its Implications on Global Forest Product Trade" Forests 11, no. 2: 178. https://doi.org/10.3390/f11020178

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