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Re: st: Using 2 stage Heckmen Sample Selection with Lags in STATA


From   "Austin Nichols" <austinnichols@gmail.com>
To   statalist@hsphsun2.harvard.edu
Subject   Re: st: Using 2 stage Heckmen Sample Selection with Lags in STATA
Date   Thu, 2 Aug 2007 10:53:49 -0400

Seema--
Just googled "standard gravity model" and found a bunch of papers
criticizing it, e.g.
http://www.tbm.tudelft.nl/webstaf/ceesb/gravityweb.pdf
who makes another good point--if you are considering importing from
country i, the distance from you to country i is less important than
the distance relative to other potential exporters, since the relative
distance is what measures the effective "price" of trade between you
and country i.

On 8/2/07, Austin Nichols <austinnichols@gmail.com> wrote:
> Seema--
> I am not familiar with the "standard gravity model" though I suspect
> it models trade as a function of the reciprocal of the square of
> distance along an ellipsoid between the centroids of two countries,
> among other things.  This seems inappropriate for various reasons
> (even if using production- or population-weighted centroids, the
> relevant distance is not as the crow flies--e.g. contiguity is likely
> more important, as are topographical features, and historical
> relationships/religion/language/etc. even more important) though if
> the model is "standard" I suppose am unlikely to talk you out of it.
>
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