Herman P. R. and Oliver, S. (2023) "Trade, Policy, and Economic Development in the Digital Economy," Journal of Development Economics. https://doi.org/10.1016/j.jdeveco.2023.103135
Herman, P. R. (2022) "A Pragmatic Approach to Estimating Nondiscriminatory Non‐tariff Trade Costs," Review of International Economics 30 (4): 1258-1287. https://doi.org/10.1111/roie.12604
Herman, P. R. (2022) "Modeling Complex Network Patterns in International Trade," Review of World Economics 158 (1): 127-179. https://doi.org/10.1007/s10290-021-00429-y
"One Nation, One Language? Domestic Language Diversity, Trade and Welfare" (2021), USITC Office of Economics Working Paper 2021-01-B, with Tamara Gurevich, Farid Toubal, and Yoto Yotov.
Abstract: Using new data on linguistic diversity across and within countries, we examine novel channels though which language affects trade patterns and economic welfare. We find that linguistic similarity within a country accounts for about 10 percent of estimated `home bias', demonstrating the importance of shared languages for domestic integration. To highlight the general equilibrium implications of domestic language proximity, we simulate the repeal of Quebec's Bill 101, which made French an official language in Canada and established fundamental language rights for French-speakers. The analysis demonstrates that domestic language diversity has significant implications for Canada's welfare but also sizable economic consequences that stretch far beyond its borders.
"gegravity: General Equilibrium Gravity Modeling in Python" (2021), USITC Office of Economics Working Paper 2021-04-B.
Abstract: The gegravity Python package is a collection of tools for analyzing general equilibrium, structural gravity models of international trade. It provides a framework for estimating structural gravity models, simulating counterfactual trade experiments, and conducting Monte Carlo simulations to derive measures of statistical precision for model estimates. The package is based on prominent models used in the literature and aims to make structural gravity modeling more readily accessible to researchers and policy analysts.
"The Short-run Effects of Product Differentiation on Trade" (2019, update), USITC Office of Economics Working Paper No. 2019-11-A, with Ryan Lee.
Abstract: Gravity models of trade have long found that estimates of trade determinants differ across both time and products. In this paper, we demonstrate that there is a systematic relationship between these two influences. Past research has found that trade factors such as distance, common language, and preferential trade agreements matter more for differentiated products than homogeneous products. We find, however, that these differences are only a short-run phenomenon. As goods trade for longer periods of time, differentiated and homogeneous goods exhibit increasingly similar trade patterns. We propose a search model of trade that explains this behavior and find strong empirical support using gravity models that account for product type and trade duration. Additionally, we identify several other relationships between trade determinants and time. Determinants that affect recurrent trade costs, such as distance and preferential treatment, become more important over time. Determinants that impact fixed costs, such as language and colonial ties, become less important. These findings indicate that accurate modeling of trade through time and across different products ought to consider the systematic relationships across both dimensions.
Competitive Conditions Affecting U.S. Exports of Medical Technology to Key Emerging Markets, (2018) USITC Economics Working Paper No. 2018-08-A, with Jeff Horowitz and Mihir Torsekar
The Dynamic Gravity Dataset: 1948--2016, (2018) USITC Economics Working Paper No. 2018-02-A, with Tamara Gurevich
Abstract: The estimation of gravity models of international trade extensively relies on the availability of unilateral and bilateral, country pair measures of theoretical determinants of trade. Existing datasets provide a wealth of information, but often come short in terms of temporal and other forms of variation. This paper presents a recently developed Dynamic Gravity dataset that improves upon existing gravity datasets by including additional variables of interest and featuring greater variation for use in econometric analysis. We describe the dataset and highlight the key diﬀerences between our Dynamic Gravity dataset and the datasets often used by researchers previously. Analytical comparisons are included that demonstrate important similarities and diﬀerences through summary statistics and estimates of sample gravity models using the Dynamic Gravity dataset and two alternative data sources: the CEPII gravity database constructed by Head et al. (2010) and the Rose (2004) dataset. We ﬁnd that the Dynamic Gravity dataset is nearly indistinguishable from the other sources and produces results consistent with international trade theory. However, in some cases, it produces results that are qualitatively similar but quantitatively diﬀerent from the others, which we take as support that our attempts to improve on past datasets have succeeded.
Data Links: https://www.usitc.gov/data/gravity/dataset.htm