This paper tests the relationship between income inequality and trade flows. The model is based upon Helena Bohman and Désirée Nilsson (2007) and Mitra Trindade and Dalgin (2008). This paper will set up gravity model for 50 countries which includes, income distribution, population, average individual income level and GINI variable as distribution of disposable income as an explanatory variables. Results confirm that when income inequality increases in the exporting country, export of necessities increase and export of luxuries decrease. Income distribution also shows expected effect on trade flows in the importing country. When income inequality increases in the importing country, import of necessities decrease and import of luxuries increase.

There has been much research regarding Trade Immigrant link for different countries, states and provinces which reveal that Immigration impacts bilateral Trade positively. In this study the Trade –Immigrant for Sweden for a period of 2000-2011 for 184 trading partners has been tested which shows that trade and Immigration have positive relationship. Using random effect model, with every 10% increase in Immigrants, there is 4.0% increase in imports and 4.4% increase in exports of Sweden from particular trading partner. In second hypothesis of the study Trade-Emigrant link for Sweden and its 185 trading partners has been checked in cross country sample for year 2010.To the best of my knowledge, this study is first to test the Trade-Emigrant link for Sweden. The results show that there is positive link between trade and Emigration from Sweden. An extended Gravity Model has been used in this study. Using ordinary least square method, with every 10% increase in Emigrants, there is 7.2% increase in imports and 4.3% increase in exports of Sweden for that particular trading partner.

This thesis examines the bilateral trade between Vietnam and twenty three European countries based on a gravity model and panel data for years 1993 to 2004. Estimates indicate that economic size, market size and real exchange rate of Vietnam and twenty three European countries play major role in bilateral trade between Vietnam and these countries. Distance and history, however, do not seem to drive the bilateral trade. The results of gravity model are also applied to calculate the trade potential between Vietnam and twenty three European countries. It shows that Vietnam’s trade with twenty three European countries has considerable room for growth.

This paper investigates the impact of inward FDI (Foreign Direct Investment) on international trade of China empirically on the country level by using panel data from 1984 to 2007. Two separate transformed models which are based on the gravity equation and refer to the econometric models of some previous studies, are used in this paper to estimate the effect of FDI inflows on exports and imports respectively. The estimation results confirmed the complementary relationship between FDI inflows and trade of China both on exports and imports, which has also been supported by previous empirical studies.

<p>This thesis investigates in what way trade flows in Europe have been altered and differ for countries belonging to a preferential trade agreement as well as a common currency area. More specifically, how exports among the European countries are affected by memberships with the European Union and the EMU. A total of 72 countries have been chosen which represents the main trading partners between the EU and the rest of the world. Out of these 72 countries, 25 represent EU members which include 12 EMU member countries.</p><p>The econometric analysis employ a gravity model with 18 variables in order to determine their impact on trade flows. This is done through a regression with a log-log equation where the dependent variable is export. The other variables included are chosen to explain export flows among the EU members as well as their trade with EMU countries and the rest of the world. Furthermore, variables representing trade affinities are included to determine whether or not they have a significant effect on trade.</p><p>The regression is divided into four time periods in order to more easily determine how the trade pattern in Europe have altered from the establishment of the EU and the EMU. The first time period represent an early state of EU membership, the second a mature state of EU membership, the third when EU was reformed and the fourth an early state of EMU membership.</p><p>The regression results illustrate that the majority of the selected variables are significant but most importantly that the trade affinity variables are proven to have an impact on trade flows. The results also show that trade has increased and that in the case of EU membership it is more profitable to join than to remain outside. Moreover, the result show in par-ticular that countries that belong to the EMU have a stronger orientation of their exports to the rest of the world then other EU countries. For the latter, the European market is of prime importance.</p>

<p>This thesis is an assessment of the dynamics of trade affinities and how they have influenced trade flows in the European continent. The focus is how trade affinities have altered over a time span of four time periods stretching from the 1970s up to today and how these alterations have influenced globalization.</p><p>A total of 41 countries belonging to the European continent have been selected. Furthermore four variables were selected to represent trade affinities; distance, border, colony, and language. These have been selected as they are generally believed to be static and thus should not change over time. Also, this thesis aims to show the separate influence of each trade affinity as other papers usually estimate trade affinities as one collective variable.</p><p>By the use of a gravity model 9 variables are tested in order to determine their influence on trade flows. This is done through a regression with a log-log equation where the dependent variable is Export and the affinity variables are estimated as dummy variables.</p><p>The regression is divided into four time periods in order to more easily determine how the trade affinity variables have altered in influence on trade flows in Europe. The first time period represent an average of the time period 1974-1976, the second 1984-1986, the third 1994-1996 and the fourth 2004-2006.</p><p>The regression results illustrate that the majority of the selected variables are significant but most importantly that the trade affinity variables are proven to have altered over the time periods. The performance of a Wald estimation gives an indication that trade affinities are in fact dynamic although the results are not entirely significant for all variables.</p><p>Based on the results, it is apparent that trade affinities still have a significant effect on trade flows in the European continent. Although, their effects have altered to become less significant in some cases while others have become stronger they all jointly share the attributes of affecting trade. These alterations can in turn be interpreted as dependent on the globalization process of the European continent. As globalization has progressed some affinities have decreased in influence while others have regained new importance.</p>

<p>This bachelor thesis aims to estimate Sweden’s export potential towards South-Korea since initial data indicates that Sweden has from 1997 up until 2005 been exporting less to South-Korea when compared to, in general, OECD. Furthermore, South-Korea seems to be a low prioritized market for Swedish firms in the East-Asian region. As many before us, we have used a basic gravity model, including GDP and distance in kilometer has been used as explanatory variables for the observed trade value. The dummy variable land-locked, to estimate trade potential for 15 commodity groups. Sweden was set to be the exporting country, South-Korea the importing country together with all the other OECD members, which were used as points of reference.</p><p>The outcome of the gravity regression shows that distance and the dummy variable landlocked (if a country does not have access to open water) have a very strong relationship to the observed export data. However, GDP was proven to have a very weak relationship to the observed export data thus making the estimation process of trade potential for all, except one, commodity group biased.</p><p>The gravity model has been widely criticized for inflating export potential due to misspecification a problem that we experienced when running our regression. Thus, from this study no strong conclusions can be drawn concerning the trade potential from Sweden to South-Korea.</p>

The Iranian economy has over 30-years been under several of US sanctions due to differences in their political objectives, affecting primarily their economic lifeblood, the oil business. Therefore during this period the Iranian economy has experienced setbacks in their development of national prosperity. This paper investigates the effect of the economic sanctions, during the time period 1975-2006, on Iran’s trade flows by incorporating the gravity model. Also, including geographical proximity and cultural ties further extends the model, which has been shown to strongly influence trade. The findings suggest that sanctions have negative impact on trade flows and are consistent with previous findings. Further estimation methods such as the Heckman- and PPML method are applied accounting for zero trade flows. The empirical  results indicate that sanctions have had a large negative effect on trade flows as expected. When further dividing the sanctions into five different time periods the results conclude the previous ones, however the five time periods have been influenced by sanctions in different varieties. Hence sanctions hamper trade and prevent the Iranian economy to thrive to its fullest potential.

This thesis is an assessment of the dynamics of trade affinities and how they have influenced trade flows in the European continent. The focus is how trade affinities have altered over a time span of four time periods stretching from the 1970s up to today and how these alterations have influenced globalization. A total of 41 countries belonging to the European continent have been selected. Furthermore four variables were selected to represent trade affinities; distance, border, colony, and language. These have been selected as they are generally believed to be static and thus should not change over time. Also, this thesis aims to show the separate influence of each trade affinity as other papers usually estimate trade affinities as one collective variable. By the use of a gravity model 9 variables are tested in order to determine their influence on trade flows. This is done through a regression with a log-log equation where the dependent variable is Export and the affinity variables are estimated as dummy variables. The regression is divided into four time periods in order to more easily determine how the trade affinity variables have altered in influence on trade flows in Europe. The first time period represent an average of the time period 1974-1976, the second 1984-1986, the third 1994-1996 and the fourth 2004-2006. The regression results illustrate that the majority of the selected variables are significant but most importantly that the trade affinity variables are proven to have altered over the time periods. The performance of a Wald estimation gives an indication that trade affinities are in fact dynamic although the results are not entirely significant for all variables. Based on the results, it is apparent that trade affinities still have a significant effect on trade flows in the European continent. Although, their effects have altered to become less significant in some cases while others have become stronger they all jointly share the attributes of affecting trade. These alterations can in turn be interpreted as dependent on the globalization process of the European continent. As globalization has progressed some affinities have decreased in influence while others have regained new importance.

In this thesis factors that explain Swedish pharmaceutical export as been analyzed. The period investigated is from 1995 to 2010. The investigation is concluded through the use of a gravity model. It investigates not only the GDP and distance variable but also the effects of GDP/capita, exchange rates and the effect of being a part of the internal market of EU. The effects of having access to the ocean and if the country has English as its official language is investigated as well as the effect of sharing the same religion. The results show that only a smaller subset of countries make up for most of the pharmaceutical export. The results also shows that the pharmaceutical export can be explained by the same variables as most other goods.