TITLE:
Intra-African Trade and Spatial Dependence: Revisiting Africa Intra-Trade Determinants with a Spatial Structural Gravity Model
AUTHORS:
Mariame Bakouan, Idrissa Mohammed Ouedraogo
KEYWORDS:
Intra-Trade, Regional Integration, Spatial Structural Gravity Model
JOURNAL NAME:
Theoretical Economics Letters,
Vol.12 No.1,
February
8,
2022
ABSTRACT: The objective of our paper is to revisit African intra-trade
determinants once taking into account potential spatial spillover effect due to
the third country dependence. Recently, several studies have shown the
importance of taking into account the spatial effect. We examined total exports
flows, industrial trade flows and agricultural trade flows of 40 countries in 2002-2018 and we detected a positive
spatial autocorrelation and the Spatial Autoregressive gravity model is identified as an appropriate way to
model the spatial dependence. The results show that distance doesn’t affect
agricultural products trade, institutional factors of destination country and
neighboring countries affect intra-African trade. Except SADC area, intra-African
trade is largely dominated by agricultural products. To reduce poverty through
trade intensification, the regional integration process in Africa must grant an
important place to industrialization policies, conflict resolution and
strengthening cooperation.