Constraints on Trade in the MENA region

February 1, 2010

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Hirut Wolde, and Rina Bhattacharya. Constraints on Trade in the MENA region, (USA: International Monetary Fund, 2010) accessed December 26, 2024

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary

In this paper we estimate gravity models to see whether trade volumes of countries in the MENA region are significantly lower than what would be expected given their economic, cultural and geographical characteristics. Our empirical results show that the variables used in standard gravity models cannot explain a significant part of MENA's trade performance, particularly on exports. We then go on to 'augment' the standard gravity model with relevant variables from the World Bank's Business Enterprise surveys. Our results further show that these variables, and in particular transport constraints and inefficiencies in customs clearance processes, are important in explaining the MENA region's underperformance in trade.

Subject: Business enterprises, Exports, Gravity models, Imports, Transportation

Keywords: Business, Customs, Mena, Trade, WP

Publication Details

Pages:

19
Volume:

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DOI:

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Issue:

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Series:

Working Paper No. 2010/031
Stock No:

WPIEA2010031
ISBN:

9781451962604
ISSN:

1018-5941

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