چکیده:
Among the reactive responses of countries to cope with the phenomenon of globalization is the tendency toward economic and regional convergences. For developing countries that are not prepared for a sudden entry into free trade, regionalism can be the most effective way to gradually open national economies and integrate them into the global economy. In this study, a generalized gravity model has been used to examine the convergence of the D-8 Islamic group countries. This model is calculated using the panel data method to take into account fixed and individual effects related to trading pairs and to eliminate heterogeneity bias. Based on the results, the gross domestic product of host and guest countries (as mass) and geographical distance (as distance) are in accordance with the gravity theory. On the other hand, the economic structure difference index and the economic openness index play a positive role in bilateral exchange flows. Therefore, according to the empirical results, the D-8 group is moving towards convergence and can move on the path of globalization by increasing economic cooperation among members.
خلاصه ماشینی:
Helpman 1 (1984), by substituting bilateral foreign investment flows (capital inflow and outflow) for inter-country trade exchanges, proposed a gravity model to analyze the effects of 1 Helpman regional integration on the level of reciprocal FDI between countries stated.
The data employed to estimate the convergence model consists of bilateral foreign direct investment FDIijt, and the Gross Domestic Product of the host and guest countries (capital) GDPit and GDPjt. These data have been extracted from the International Financial Statistics (IFS)1 published by the International Monetary Fund (IMF)2 and from the United Nations Conference on Trade and Development (UNCTAD) website.
In accordance with the theory of the problem, the gross domestic product of the host and guest countries (capital) as convergence index and indicator of the economic size of countries has a positive effect on the bilateral flow of foreign capital in the D-8 group.
Figure (5): Results of the secondary estimation of the convergence gravity model for the entire period under study (Refer to the page image) Source: Researcher's calculations The results indicate a negative effect of the distance between two countries on the volume of bilateral FDI.
Figure (9): Results of the secondary estimation of the D-8 group convergence gravity model during the formation period 1997-2007 (Refer to the page image) Source: Researcher's calculations Additionally, the economic openness index has increased during the formation period, indicating that member countries have taken steps to reduce political- trade has been implemented.
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