Study On Gravity Border Effect Model

摘要

This paper explores various kinds border effect equations derived from the Gravity Model to study the differences between international and intra-nationai trade. First, after putting forward baseline gravity border effect model and the border effect model in the monopolistic market, an adjusted model is introduced. Then the border effect between China and US in the field of agriculture is measured using the panel data of year 1997, 2002 and 2005. The results show that the border effect does exist in Sino-US bilateral agricultural trade and drops from 22.4 in year 1997 to 7.0 in year 2005, which means that each Chinese region tends to trade much greater with the other Chinese regions than with a US region in agricultural trade.