Analyzing Trade Liberalization Effect in the Egg Sector Using a Dynamic Gravity Model

Abstract:     
This study analyzes the effects of different liberalization scenarios in the international trade of eggs and egg products. We use a dynamic gravity model that takes into account the observed persistence of trading partners. The estimated parameters of the gravity model serve to quantify the impact of various liberalization scenarios on the probability of importing (extensive margin) and on trade volumes (intensive margin). The results indicate that even in the context of aggressive trade liberalization, trade gains at the extensive margin will be modest. Gains at the intensive margin of trade are present even in the context of partial liberalization - Doha type - of trade.

Number of Pages in PDF File: 41

Keywords: Eggs and eggs products, persistence in trade, trade liberalization, gravity model, random-effects dynamic Probit, autoregressive panel

JEL Classification: Q17, F13

working papers series