The geographical pattern of Irish foreign-trade - test of a gravity model

Abstract

This article assesses the extent to which economic approaches to the geographical pattern of foreign trade explain the pattern of Irish merchandise imports and exports. The approach adopted is that of a `gravity? model of foreign trade flows. This hypothesises that the geographical pattern of a country's trade is determined by the economic size of trade partners and their distance apart. The `preference similarity? approach, which hypothesises that trade in manufactured goods is concentrated among countries with similar incomes and tastes, is also examined. The article finds evidence in favour of the gravity approach but not the preference similarity hypothesis.