Does Bilateral Trade Agreement Promote Extensive and Intensive Margins of Exports? The case of Indonesia
DOI:
https://doi.org/10.36574/jpp.v10i1.712Keywords:
bilateral trade agreement, extensive margin, intensive margin, gravity model, Indonesia, export diversificationAbstract
This study investigates the association of bilateral trade agreements (BTAs) with Indonesia’s export performance, focusing on the extensive margin (diversification of exported products) and the intensive margin (increased trade volumes of existing products). Using gravity model data from 2004 to 2022 across 57 countries, the findings shows that BTAs have a significantly positive relationship with real exports, extensive margins, and intensive margins, especially in manufactured goods. Other positive factors include plurilateral trade agreements (PTAs), economic size, historical ties, and common language, while geographic distance remains a trade barrier.
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