A Gravity Approach to Determinants of Export in a Small Open Economy: ‎Evidence from Jordan

Authors

  • Metri F. Mdanat German Jordanian University
  • Taleb A. Warrad
  • Loay M. Salhieh
  • Talah S. Arabiyat

Abstract

This study seeks to identify the main factors affecting exports in small open economies. It uses panel data from 2001 to 2014 and a gravity model to identify these factors in one such economy. Our results are relevant for policymakers in small economies which engage in free trade agreements and trade liberalization to pursue economic development via trade openness and investment. We found mixed results as to the‏ ‏direction of the relationship between free trade agreements and exports, a positive ‎contribution of relative income in boosting exports and negative distortionary effects of distance ‎and costs on exports.‎ These findings suggest that there are differential impacts of trade liberalization over time on the export performance of small open economies. Hence, policies aiming to maximize the benefits of trade agreements and reduce costs may be helpful in promoting exports.

Keywords: Gravity model, Export determinants, Economic growth.

JEL Classifications: F1, F13, F43

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Author Biography

Metri F. Mdanat, German Jordanian University

Dr. Mdanat joined the German Jordanian University as professor of economics in September 2014. Prior to that he had over 15 years' experience in government fiscal reform projects in Jordan, including seven years as an Economic Policy Advisor with the German Development Cooperation (GIZ) at Ministry of Finance. Dr. Mdanat was a member of the Board of Directors, Jordan Development Zones Company (JDZ), member of Subsidy Advisory Committee at Ministry of Finance and Member of the Technical Committee for National Railway, with Ministry of Transport. From 2011-2013 he was Acting director of study and economic policy directorate at Ministry of Finance. From 2008 -2011, Dr. Mdanat was responsible for establishing and managing the Macro Fiscal Unit at the Ministry of Finance, his main duties were strategic planning, fiscal decentralization, financial forecasting and modeling techniques. From 2000 – 2007 he work as an economist in Ministry of Finance.

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Published

2018-03-16

How to Cite

Mdanat, M. F., Warrad, T. A., Salhieh, L. M., & Arabiyat, T. S. (2018). A Gravity Approach to Determinants of Export in a Small Open Economy: ‎Evidence from Jordan. International Journal of Economics and Financial Issues, 8(2), 40–46. Retrieved from https://www.econjournals.com/index.php/ijefi/article/view/6003

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