Import Flows of Bangladesh: Gravity Model Approach under Panel Data Methodology

  • Mili Roy Institute of Statistical Research and Training (ISRT), University of Dhaka, Dhaka-1000
  • Md. Israt Rayhan Institute of Statistical Research and Training (ISRT), University of Dhaka, Dhaka-1000
Keywords: Gravity Model, Pooled OLS, Fixed effect, Random effect

Abstract

In counterpoint to export growth, Bangladesh import growth has remained much less strong, despite impressive progress in import liberalization. This study gives an overview of different methodologies related to gravity model analysis in Bangladeshs import flow. A pooled cross section and time series data were analyzed to incorporate the country specific heterogeneity in country pair trading partners. The import flows are justified by the basic gravity model since Bangladeshs imports are positively significant by the economy size and inversely related to trade barrier. Accordingly, we have analyzed pooled ordinary least square, fixed effect, random effect. This study also explores extended gravity model using several variables in the light of gravity model panel data approach. Bangladeshs import is determined by the home and foreign countrys gross domestic product and exchange rate. In addition, Cross section results show that regional trade arrangement which is South Asian Association for Regional Co-operation and border are significant for Bangladeshs importimplies that Bangladesh should import more from intra regional country and also should import from India.

DOI: http://dx.doi.org/10.3329/dujs.v60i2.11485

Dhaka Univ. J. Sci. 60(2): 153-157, 2012 (July)

 

 

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Abstract
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1567
Published
2012-07-31
How to Cite
Roy, M., & Rayhan, M. (2012). Import Flows of Bangladesh: Gravity Model Approach under Panel Data Methodology. Dhaka University Journal of Science, 60(2), 153-157. https://doi.org/10.3329/dujs.v60i2.11485
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