Author :
DOI : 10.29228/ASOS.64260
Year-Number: 2022-133
Yayımlanma Tarihi: 2022-10-06 21:33:51.0
Language : İngilizce
Konu : Uluslararası İktisat
Abstract
Keywords
Abstract
Belt and Road Initiative (BRI) is a strategy proposed by the People’s Republic of China in 2015. BRI is an initiative that aims to integrate countries with infrastructure investments. BRI contains six international economic corridors. These corridors reduce the distances between countries thanks to roads, ports, and infrastructure investments. In this study, we analyzed the impact of infrastructure on export in Belt & Road countries during 2000–2020 by applying the System GMM approach. The consequences show the important and positive impact of indication and sub-indications (i.e., energy, telecommunication, transport, and finance) of infrastructure on export in countries like Asia, Europe, the Middle East, and Africa.
Keywords
- Linhui Yu et al. (2020) in their study; used the difference in differences estimation met- hod to examine the impact of the Belt and Road Initiative on China's export potential to countries along the Belt and Road route. The results of the study using the pre- and post-entry trade figures of the countries; It has shown that China has increased its exports of especially capitalintensive goods to the Belt and Road countries. In addition, it has been revealed that the export potential has increased more in Southeast Asian countries than in West Asian countries. In a report published by the OECD (2018), it has been reported that BRI will seriously affect global trade with investments and the changes it will cause in the global financial system.
- Ekrem Erdem and Nazlioglu (2008) analyzed panel data containing the determinants of Turkey's agricultural exports to 23 European Union (EU) countries in the 1996-2004 period using the gravity model. In this study, Turkey's agricultural exports to the EU; revealed that the size of the economy, the population of the importing countries, and the Turkish population living in the EU countries are positively related. On the other hand, the geographical distance between Turkey and EU countries, the customs union agreement, and the relationship with EU countries with arable land are seen as inversely proportional.
- Lisbeth Hellvin Lars Nilsson (2000), they investigated the volume and direction of trade between country groups such as the EU, and NAFTA, using the gravity model. Karagoz and Saray (2010) tried to estimate the trade potential between Turkey and Asia Pacific countries using the gravity model approach. Another study Bilici et al (2008), desired to actuate the role of the EU in Turkey's commerce flows by using the gravity model, in addition to testing whether the Customs Union (EU) that Turkey entered in 1996 caused deviations in Turkey's commerce flows.
- Jin Sun (2021) examines the effect of BRI as a regional trade agreement on the export quality of the countries involved in the agreement in terms of value-added products. In the research, the number of entrepreneurs and product range of 11 BRI countries and China was used as data. According to the results of the study, the export quality of BRI countries increased with the treaty. Claiming that BRI will affect and change both the global supply chain management and logistics development, it has been stated that economic and social welfare will increase thanks to the increasing mutual trust with the countries within the scope of BRI Song and Cui, (2019). METHODOLOGY
- While the Gravity Model is important in terms of using the GDP size of the countries and the transportation costs arising from the distance between countries as factors affecting foreign trade, its use in the BRI is also important in terms of allowing more realistic analysis. However, this analysis method is also important in terms of testing the impact of international trade agreements and regional integrations. The Gravity Model includes not only economic data but also the effects of non-economic factors on foreign trade Muratoğlu (2013).
- In transnational commerce, the gravity model was first introduced by Tinbergen (1962) and Poyhonen (1963) mainly to resolve bilateral trade flow patterns between European countries. Since then, the gravity model has been used and extended in empirical studies of international trade flows. While Linneman (1966) added population data to the Tinbergen model, other economists such as Kien and Hashimoto Kien and Hashimoto (2005), Armstrong, (2007) made more explanatory and complementary contributions to the model, such as commercial data.
- From 1940s, the gravity model has been assigned to a compherensive variety of goods and factors of production that cross-regional and national boundaries under different conditions Oguledo and Macphee (1994). The basis of the model is based on the gravity law of Newton’s in mechanics. This law; states that two bodies attract each other in proportion to the product of each body's mass (in kilograms) divided by the square of the distance (in meters) between their respective centers of gravity. Later, Stewart who was an astronomer and Zipt who was a sociologist engaged this act to the social sciences and tried to engage it to examples like intercity trips, as in the equation shown below.
- (1) In this equation, Iij is the number of trips between country i and country j, popi shows the population in country i, popj shows population in country j, Dij is the distance between country i and country j, and G is a coefficient. International trade is likened to this model. The model is based on the following; “The trade flow between two countries is proportional to the product of each country's 'economic mass', this mass expressed in economics as GDP. This mass “GDP” is divided by the distance between countries. 'economic centers of gravity are usually calculated based on capitals Christie (2002). This equation can be generalized as;
- The study covers a total of 17 countries engaged in international trade among themsel- ves in the selected South Asian, Central Asian, and Pacific regions within the scope of BRI. These countries; are Cambodia, Brunei, East Timor, Kazakhstan, Indonesia, Malaysia, Kyrgyzstan, Laos, Philippines, Myanmar, Pakistan, Singapore, Thailand, Tajikistan, Turkmenistan, Uzbekistan, and Vietnam. Panel data in the form of 17 (countries) X 20 (years) for the countries' GDP, population, and some other dummy variables between the years 2000-2020 were created. Table 1 Variables Used in The Gravity Model Variable Unit Variable
- 2000 43,453,361,089.1
- Log-likelihood −19775.80 Akaike criterion 39571.60
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