Title:
Redefining Trade Dynamics: Inorporating Network Centrality, Spatial Heterogeneity, and Optimal Transport Theory into Models of International Trade
Redefining Trade Dynamics: Inorporating Network Centrality, Spatial Heterogeneity, and Optimal Transport Theory into Models of International Trade
Author(s)
Helfrich, Ian T.
Advisor(s)
Nair-Reichert, Usha
Besedes, Tibor
Besedes, Tibor
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Abstract
This dissertation explores new approaches to modeling international trade, focusing on network effects, spatial distributions, and optimal resource allocation. The research is structured in three interconnected chapters, each addressing a distinct aspect of trade dynamics.
The first chapter investigates how network centrality measures can enhance our understanding of trade patterns. By constructing a trade network using BACI-CEPII data from 1995 to 2015, the study augments traditional gravity models with various centrality measures. The results suggest that a country's position within the global trade network significantly influences its trade relationships, beyond what economic size and distance alone can explain.
Chapter two introduces a novel method for measuring effective distance between trading partners. This approach uses nightlights and population data to create weighted centroids, capturing shifts in economic activity and population distribution over time. Applied to U.S. interstate trade in 2017 and global trade flows from 2015 to 2020, this measure shows promise in improving gravity model estimations compared to conventional distance measures.
The final chapter develops a theoretical framework that unifies equilibrium theory and optimal transport in infinite-dimensional spaces. This work proves the existence and uniqueness of equilibrium under general conditions and characterizes these equilibria as solutions to optimal transport problems. While theoretical in nature, this approach offers new insights into market efficiency and resource allocation in complex economic systems.
Collectively, this research aims to advance our understanding of international trade by incorporating network effects, spatial heterogeneity, and optimal transport theory into existing models. These approaches may offer improved explanatory power and policy relevance compared to traditional methods, though further research is needed to fully assess their impact and applicability.
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Date Issued
2024-07-27
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Resource Type
Text
Resource Subtype
Dissertation