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The Effect of Trade Liberalization of Bosnia and Herzegovina with the Leading Trade Partners
Kurtovic, Safet | Halili, Blerim | Maxhuni, Nehat
Applied Economics Quarterly, Vol. 63 (2017), Iss. 4 : pp. 341–367
1 Citations (CrossRef)
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Faculty of Management and Business Economics, University of Travnik, Aleja Konzula 5, Travnik, 72270, Bosna and Herzegovina
Department of Economics, College “Biznesi” 29 Motrat Qiriazi, 10 000, Prishtinë, Republic of Kosovo
Department of Economics, College “Biznesi”, 29 Motrat Qiriazi, 10 000, Prishtinë, Republic of Kosovo
Cited By
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The determinants of FDI location choice in the Western Balkan countries
Kurtović, Safet
Maxhuni, Nehat
Halili, Blerim
Talović, Sead
Post-Communist Economies, Vol. 32 (2020), Iss. 8 P.1089
https://doi.org/10.1080/14631377.2020.1722584 [Citations: 15]
Abstract
This paper presents our research on the effect of trade liberalization with leading trade partners on Bosnia and Herzegovina’s (B&H) trade balance. The theoretical framework includes a gravity model and GMM dynamic panel analysis as the econometric technique. The research results show that the export of products from B&H increased thanks to the growth of macroeconomic indicators of trading partners, dummy variables and the export of certain products according to the sector structure. On the other hand, imports of products to B&H decreased due to the decline of B&H’s macroeconomic indicators, dummy variables and reduced imports of certain products according to the sector structure. From these findings, we can conclude that through the process of trade liberalization with developed countries, B&H recorded an increase in exports and reduction of the leading imports sector, which led to a reduction in the trade deficit.