Course Description: The objective of this course is to serve as a practical guide for analysis of trade flows and trade policy with the structural gravity model, i.e., the workhorse model in international trade and recently referred to as ‘new quantitative trade model’. To this end, the course combines cutting edge academic research and extensive policy experience, and it offers a comprehensive and balanced approach between theory and empirics. The course traces the evolution of the structural gravity model from its initial a-theoretical applications to the most recent structural estimation gravity frameworks, e.g. dynamic gravity. After deriving the original gravity equation, it is shown that the same model can also be derived from many different theoretical micro-foundations. Guided by theory, a set of best practices and recommendations are established for partial equilibrium gravity estimations, and their importance is demonstrated with a series of trade policy applications including bilateral policies (e.g., evaluating the impact of FTAs, sanctions, etc.) as well as non-discriminatory policies and country-specific characteristics (e.g., export support, institutional quality etc.). The same gravity framework is then used to translate the partial equilibrium policy estimates into full general equilibrium effects on various economic outcomes, e.g., trade, prices, welfare. The course concludes with a demonstration of how the gravity model of trade can be nested into a wide range of production models with a focus on dynamic capital accumulation and FDI. The lectures are complemented by hands-on practice sessions that will allow participants to fully experience and experiment with the partial as well as the general equilibrium capabilities of the model. Importantly, owing to recent research developments, all experiments and exercises in this course (including the general equilibrium simulations), are performed with standard built-in commands in Stata, however Matlab codes will be provided as well.
About the Instructor. Yoto V. Yotov is a Professor of Economics at Drexel University, USA, and a Research Professor at the ifo Institute, Germany. Yotov’s research articles appear in the The American Economic Review, The Economic Journal, and The Journal of International Economics, among others. Yotov is an Associate Editor at The Review of International Economics and at Economics Letters. He has consulted and advised a number of international organizations (e.g., the WTO, OECD, the World Bank, the European Commission, the United Nations), national governments (e.g., of the United States, Germany, Canada, and the U.K.), think tanks and research institutes (e.g., the ifo Institute and the Kiel Institute). Yotov’s book “An Advanced Guide to Trade Policy Analysis: The Structural Gravity Model” (Co-published by the UN and the WTO) is the basis for the structural gravity course that Yotov has taught to participants from more than 140 countries around the world. For additional information, please visit: http://yotoyotov.com/
Audiences and Prerequisites. The course may be beneficial to (i) Applied Economists and Policy Makers; (ii) Advanced Master Students; (iii) Ph.D. Students; and (iv) Academic Researchers. The prerequisites for the course include Master-level Microeconomic Analysis and Master-level Econometric Analysis. Previous experience with Stata, including data manipulation and use of canned estimation commands (no coding!) is also required. Participants should bring their own computers, but the organizers will provide the latest version of Stata, which is the only software that is required for the course. The course will be taught exclusively in English.
Course Outline. The course will take place in person at the “D.A. Tsenov” Academy of Economics, Svishtov, Bulgaria from October 11-13 according to the following schedule:
Lecture 1: All Roads Lead to Gravity: Introduction to the Gravity Model of
Oct. 11, 3pm-6pm International Trade. Theoretical Foundations.
Lecture 2: Estimating Structural Gravity: Challenges, Solutions and Best Practice
Oct. 12, 9am-12pm Recommendations. Benchmark Estimates & Applications.
Lecture 3: From Theory to Policy with Gravitas: Puzzles and Policy Estimates.
Oct. 12, 3pm-5pm Hands-on Session on Estimating Gravity. (Stata required).
Lecture 4: GE Analysis with Gravity: Theory & Applications. Hands-on Session on
Oct. 13, 9am-12pm GE Analysis with the Structural Gravity. (Stata required).
Lecture 5: Nested Gravity: A Dynamic Gravity Model of Trade and Growth.
Oct. 13, 1pm-3pm Trade and FDI with Dynamics. Some recent developments.
Fees, and Logistics. Thanks to the joint sponsorship by the Fulbright Foundation and by the Tsenov Academy of Economics, the course will be offered for free to the qualified participants. Free temporary Stata licenses will also be provided. The organizers will be happy to assist with logistics and accommodation; however, course participants will be responsible for their own travel and accommodation costs and arrangements. The participants are also expected to bring their laptops for the practical sessions.
Application and Registration Deadline.
To apply for the course please fill this REGISTRATION FORM as soon as possible and before September 3rd, 2021. Successful applicants will be notified by September 7th, 2021. Space is limited. Please do not make travel arrangements before you have received your registration confirmation.
The course will be organized according to the current COVID 19 circumstances and Bulgarian national health requirements.
Contact and inquiries If you need a visa or if you have any inquiries, please e-mail Galin Stefanov email@example.com
We look forward to seeing you in beautiful Svishtov in October!