The Gravity-Model-of-Trade for opportunities beyond the EU after #Brexit. The #Russian anomaly.
There is a more up to date, better version of this at the UK Houses of Parliament. https://committees.parliament.uk/writtenevidence/12422/html/ This analysis is aimed at businesses considering what opportunities are available beyond the EU following Brexit. It uses the gravity model of trade to show that the potential of Russia as a trade partner beyond the EU is second only to the US. It shows that the UK already tends to trade above potential with English speaking countries. It trades well below potential with Russia, Indonesia and Argentina. The shortfall with Russia is such that meeting average performance is worth more than any deal in Asia. The Gravity Model of Trade ( http://www.nber.org/papers/w19285 ) is one of the more robust models in economics. It is based on the observation that levels of trade between countries depend on the size of the economies and the inverse square of the distance between them. Double the distance between a pair of countries and the potential for ...