Monday, February 1, 2010

i just read a paper on the above economics model.  in a nutshell, international trade volumes become the function of the size of each of two countries' gross domestic products and the distance between the two countries.  that's what i'll call the "abstract."  the paper added to the equation factors such as language commonalities, infrastructure development and the distribution of urban centers. 

the winding path of the gravity theory of economics is dotted with "duh" moments.

for instance, according to the model, two countries with telephones and computers will evidently trade more than two countries with sticks and rocks.  wow.  insightful.  or, equally shocking, and you may want to feel around for the closest armchair, the correlation between the length of time it takes to fulfill the necessary paperwork and international trade volumes is NEGATIVELY proportional.

and this paper is full of that stuff.

-dan

Daniel Stewart Mueller at 10:45 PM |

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