Thread: Brexit (Old)
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Old 11-11-2018, 12:56   #2819
1andrew1
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Re: Brexit
Quote:
Originally Posted by OLD BOY View Post
What a strange question, Andrew.

Proximity is convenient, but distance is not the barrier it once was.
Not a strange question if you understand trade. Do you have an answer?

Regarding proximity, it's still key. The standard analysis for goods is that each doubling of distance with a trading partner halves trade between them.

A survey of Canadian services exports found that each one per cent increase in distance with a trading partner reduced trade by a third of one per cent. https://www.nber.org/papers/w17630
The International Monetary Fund, which generated some estimates for the UK, found that the effect of distances on services trade was even higher than for goods. https://www.imf.org/external/pubs/ft...16/cr16169.pdf
Last edited by 1andrew1; 11-11-2018 at 13:06.
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