Citation

Discussion Paper Details

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Title: Why Do Estimates of the EMU Effect On Trade Vary so Much?

Author(s): Andrew K Rose

Publication Date: September 2016

Keyword(s): common, country, currency, exports, Gravity, meta, monetary, panel, span and union

Programme Area(s): International Macroeconomics and Finance and International Trade and Regional Economics

Abstract: Larger data sets, with more countries and a longer span of time, exhibit systematically larger effects of European monetary union on trade. I establish this stylized fact with meta-analysis and confirm it by estimating a plain-vanilla gravity model. I then explain this finding by examining systematic biases in "multilateral resistance to trade"? manifest in time-varying country fixed effects; bias grows as the sample is truncated by dropping small poor countries.

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Bibliographic Reference

Rose, A. 2016. 'Why Do Estimates of the EMU Effect On Trade Vary so Much?'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=11532