Migration is expected to be positively affected by income gains (hence, (alpha _1) is expected to be positive and (alpha _2), negative), by having a common language, a colonial relation, and a common border, and by the population in the origin country, and negatively affected by physical distance; the expected sign of the effect of population in the destination country is ambiguous a priori.
China and India have a common border and a history of conflict.
N N: North North trade, among high-income countries; N S: North South trade, exports from high-income countries to low-income countries; S N: South-North trade, exports from low-income countries to high-income countries; S S: South South trade, among low-income countries All variables are in logarithms, except binary variables (such as common border, language and different RTAs).
The USDA estimated what trade patterns would have looked like in the absence of the relevant RTA, using factors like distance, common borders, language and macroeconomic variables.
He also emphasized the importance of bilateral trade among two countries with respect to common borders, language, and common colonial regulations.
In particular, we include pairwise variables such as the distance between each pair of countries, and two dummy variables that take value 1 when the pair of countries shares a common language and a common border respectively and zero otherwise.
Namely it includes dummies for the existence of a common border (Border), a common language (Official_Lang), a common prevalent ethnic language (Official_Lang), a dummy indicating whether the trade partner was or was not a colony of the source country (Colony) and one indicating whether countries in the pair had a common colonizer post 1945 (Common_Col).
There must be a common culture and language to facilitate free movements of labour across borders; flexible wages to accommodate variations of labour supply; and a federal fiscal system to offset regional inequalities of growth.America's has these.
Turkey's longest border is with Syria, to the south, where residents on both sides are often members of larger families, sharing a common culture and language.
Geographic variables include physical distance great circle distance between the two capitals and dummies for having a common language, a past colonial relationship and a common border.
