Gravity Model Specification and Estimation: Revisited

Kalirajan, Kaliappa

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Gravity Model Specification and Estimation: Revisited

Date

2008

Authors

Kalirajan, Kaliappa

Publisher

Routledge, Taylor & Francis Group

Abstract

The gravity model is one of the most frequently estimated empirical relationships in economics. However, the most commonly used form of the relationship is not correctly specified. This article discusses the specific sources of imprecision in modelling and estimation of gravity equations and suggests a method to correct the specification bias.