Abstract
The recent changes in world politics and economy, along with the breakup of the Iron Curtain, directly influenced the foreign trade structure of the Eurasian countries. The foreign trade relations, controlled by the central planning during the Union of Soviet Socialist Republics (USSR) era, began to be formed according to free-market conditions. In this paper, empirical gravity models, covering data of 86 countries for the 1994–2018 period, are used to determine factors affecting the international integration process of the Eurasian countries. For these purposes, we estimated the classical and augmented gravity models to scrutinize the effects of border, infrastructure, trade policies, and institutions, along with the main factors. Based on the estimation results, we concluded that the Eurasian countries during the analysis period were 35% less integrated with the world trade system than the predicted potential level.
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Source: Authors' calculation based on data from WDI, World Bank
Source: Authors' calculation based on data from DOTS, IMF
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Notes
Since there is no information in the World Bank's relevant database for Afghanistan, Armenia, Iran, Iraq, Tajikistan, Turkmenistan, Uzbekistan, and Vietnam, for these countries the OTRI index was calculated by authors based on the data of the WB’s World Integrated Trade Solution (WITS) (World Bank 2018b).
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Appendix 1: List of Countries
Appendix 1: List of Countries
Afghanistan, Albania, Argentina, Armenia, Australia, Austria, Azerbaijan, Bangladesh, Belarus, Belgium-Luxembourg*, Bolivia, Bosnia and Herzegovina, Brazil, Bulgaria, Canada, Colombia, Croatia, Cuba, Cyprus, Czech Republic, Denmark, Ecuador, Egypt, Estonia, Finland, France, Georgia, Germany, Hungary, Iceland, India, Indonesia, Iran, Iraq, Ireland, Israel, Italy, Japan, Kazakhstan, Kyrgyzstan, Latvia, Lithuania, Macedonia, Malaysia, Malta, Mexico, Moldova, Mongolia, Morocco, Nepal, Netherlands, New Zealand, Norway, Pakistan, Paraguay, People's Republic of China**, Peru, Philippines, Poland, Portugal, Republic of Korea, Republic of Singapore, Romania, Russia, Saudi Arabia, Serbia – Montenegro*, Slovakia, Slovenia, Spain, Sweden, Switzerland, Tajikistan, Thailand, Tunisia, Turkey, Turkmenistan, Ukraine, United Arab Emirates, United Kingdom, United States of America, Uruguay, Uzbekistan, Venezuela, Vietnam. |
Notes: *denotes that it is considered as one country; **refers to the People's Republic of China except Hong Kong and Macau, which are individual administrative regions. For 8 out of the 86 countries, economic centers differ from their capitals (see Mayer and Zignago 2011). In those cases, we used distance data calculated for following cities: Germany (Essen), Australia (Sydney), Bolivia (La Paz), Brazil (São Paulo), Canada (Toronto), United States (New York), Kazakhstan (Almaty) and Turkey (Istanbul).
Source: Authors' elaboration.
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Golovko, A., Sahin, H. Analysis of international trade integration of Eurasian countries: gravity model approach. Eurasian Econ Rev 11, 519–548 (2021). https://doi.org/10.1007/s40822-021-00168-3
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DOI: https://doi.org/10.1007/s40822-021-00168-3