What Determines Bilateral Trade Flows? Evidence from ECO Region


  • Muhammad Ramzan Sheikh Associate Professor, School of Economics, Bahauddin Zakariya University, Multan Pakistan
  • Ruth Kattumuri Distinguished Policy Fellow, London School of Economics and Political Science, UK
  • Imran Sharif Chaudhry Professor , School of Economics, Bahauddin Zakariya University, Multan, Pakistan
  • Abodh Kumar Assistant Professor, Centre for Economic Studies & Policies, Central University of South Bihar, India, Post doctorate Research Fellow, STICERD-IO, London School of Economics and Political Science, UK




Gravity Model, Trade, ECO Region, Panel Data


This study provides an analysis of Pakistan’s bilateral trade in Economic Corporation Organization (ECO) region. The main purpose of this study is to assess the determinants of bilateral trade flows using the gravity trade model. Panel least square regression has been applied over the period of 1995 to 2015. Two types of gravity models have been estimated: traditional gravity trade model and modified gravity trade model. The study has identified income, population, distance, adjacency, area, landlockedness, continent and terrorism as the main drivers of Pakistan’s bilateral trade flows with ECO countries. It is suggested that policies in Pakistan should focus on improving economic growth; offer incentives to Pakistani people to engage more in trade flows; improve transportation to trade with ECO countries; and take measures to eradicate terrorism.


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How to Cite

Muhammad Ramzan Sheikh, Ruth Kattumuri, Imran Sharif Chaudhry, & Abodh Kumar. (2020). What Determines Bilateral Trade Flows? Evidence from ECO Region. Review of Economics and Development Studies, 5(1), 165-182. https://doi.org/10.26710/reads.v5i1.560

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