determinants of egyptian agricultural exports a gravity model approach埃及的农业出口重力模型方法的决定因素.pdfVIP

Modern Economy, 2010, 1, 134-143 doi:10.4236/me.2010.13015 Published Online November 2010 (http://www.SciRP.org/journal/me) Determinants of Egyptian Agricultural Exports: A Gravity Model Approach 1 2 1 Assem Abu Hatab , Eirik Romstad , Xuexi Huo 1College of Economics Management, Northwest AF University, Shaanxi, China 2Sr. Research Fellow in the Department of Economics and Resource Management, Norwegian University of Life Sciences, Aas, Norway E-mail : assem@ Received July 21, 2010; revised August 25, 2010; accepted August 30, 2010 Abstract In this paper, a gravity model approach was employed to analyze the main factors influencing Egypt’s agri- cultural exports to its major trading partners for the period 1994 to 2008. Our findings are that a one percent increase in Egypt’s GDP results in roughly a 5.42 percent increase in Egypt’s agricultural export flows. In contrast, the increase in Egypt’s GDP per capita causes exports to decrease, which is attributed to the fact that an increase in economic growth, besides the increasing population, raises the demand per capita for all normal goods. Hence, domestic growth per se leads to reduced exports. The exchange volatility has a sig- nificant positive coefficient, indicating that depreciation in Egyptian Pound against the currencies of its partners stimulates agricultural exports. Transportation costs, proxied by distance, are found to have a nega- tive influence on agricultural exports. These results are important for trade policy formulation to promote Egyptian agricultural exports to the world market. Keywords: Egypt Agricultural Ex