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  • Author: Hrvoje Jošić x
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Testing the validity of the Linder hypothesis for Croatia

Abstract

This paper presents empirical evidence on the validity of the Linder hypothesis in the case of Croatia. According to the Linder hypothesis, one of the new theories of international trade, countries with a similar level of income per capita should trade more. In order to investigate the trade pattern of Croatia's international trade, a panel regression model is formulated including 184 Croatia's import partner countries in the period from 2000 to 2016. The Linder effect was displayed and calculated using the Linder variable expressed as an absolute difference between GDP per capita of the importing and the exporting country. The cross-country panel regression model is estimated using Pooled OLS, Fixed and Random effects models. Results of the analysis have shown that the validity of the Linder hypothesis for Croatia cannot be accepted. Instead, the structure of Croatia's trade is in line with the gravity model of international trade.

Open access
Measurement of Export Market Concentration for the Largest European Economic Integrations

Abstract

Background: By joining different regional economic trade agreements, countries achieve preferential trade liberalisation. There are four main types of regional economic agreements in the world today: free trade area, customs union, common market, and economic and monetary union.

Objectives: The goal of this paper is the measurement of the export market concentration for the largest European regional economic integrations in the period between 1995 and 2016.

Methods/Approach: Various concentration measures have been used in the measurement of export market concentration, but the emphasis is placed on the standardized Herfindahl-Hirschman index as the basic measure of trade concentration.

Results: Results of the analysis have shown that the highest concentration level of trade with countries worldwide is among the European Free Trade Association (EFTA) countries, whereas the EU-15 countries seem to have the lowest concentration level. On the other side, the Central European Free Trade Agreement (CEFTA) countries have the highest concentration level of trade with countries from the same group, and again the EU-15 countries have the lowest concentration level, which indicates that the CEFTA countries implemented deeper integration processes related to mutual intra-regional trade.

Conclusions: Deep integration processes led to lower values of export market concentration indices for intra-regional trade among countries of the same regional economic integration in comparison to trading with countries worldwide.

Open access
Reconsidering Zipf’s law for regional development: The case of settlements and cities in Croatia

Abstract

Zipf’s law is a striking regularity in the field of urban economics that states that the sizes of cities should follow the rank-size distribution. Rank-size distribution, or the rank-size rule, is a commonly observed statistical relationship between the population size and population rank of a nations’ cities. The goal of this paper is to test Zipf’s law as applied to data for settlements and cities in Croatia using the Census of Population Survey for the year 2011. The results of the analysis have shown that Zipf’s law for settlements in Croatia holds true for the majority of the settlement sizes. However, the rank-size distribution does not hold true for extremely small and extremely large settlement sizes. When city proper and urban agglomeration of 127 Croatian cities were examined, Zipf’s law was found to hold true only for urban agglomerations. The results of the study are discussed in terms of regional development.

Open access