Resource title

Does WTO membership make a difference at the extensive margin of world trade?

Resource image

image for OpenScout resource :: Does WTO membership make a difference at the extensive margin of world trade?

Resource description

In his seminal paper, Rose (2004) concluded from a gravity-type study of bilateral trade that the GATT/WTO does not play a strong role in encouraging trade. Rose looks at countries where the amount of trade was positive to start with (intensive margin). In this paper, we present a corner-solutions version of the gravity model of bilateral trade which explains zero trade and leaves room for WTO membership to promote trade at the extensive margin of trade. Relying on a Tobit estimation approach, we find that WTO membership has promoted world trade to a larger extent than Rose s results seem to indicate.

Resource author

Gabriel Felbermayr, Wilhelm K. Kohler

Resource publisher

Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/25943

Resource license

Adapt according to the presented license agreement and reference the original author.