Trade Dynamics in the Italian Floriculture Sector within EU Borders: A Gravity Model Analysis

Bárbara Françoise CardosoMichele RasettiElisa GiampietriAdele FincoPery Fracisco Assis Shikida

DOI 10.7160/aol.2017.090202
No 2/2017, June
pp. 23-32

Cardoso, B. F., Rasetti, M., Giampietri, E., Finco, A. and Shikida, P. F. A. (2017) "Trade Dynamics in the Italian Floriculture Sector within EU Borders: A Gravity Model Analysis", AGRIS on-line Papers in Economics and Informatics, Vol. 9, No. 2, pp. 23 - 32. ISSN 1804-1930. DOI 10.7160/aol.2017.090202.

Abstract

Despite its economic magnitude worldwide, the scienti c attention to the oriculture sector remains scarce within the borders of the European Union. Focusing on Italy, the aim of this paper is to provide an insight into the oriculture trade for the rst time. More speci cally, in addition to describing trade dynamics of the oriculture sector both in Italy and in the European Union in recent years, this paper applies a gravity model to investigate and evaluate the role of some major economic and geographical variables as determinants of Italian trade ows of cut owers and live plants within the European Union, from 2001 to 2013. Among these, ndings prove that the most important are the GDP per capita of the European trade partners, as well as their production and consumption volumes.

Keywords

Floriculture sector, Italian trade, gravity model, panel data, Europe.

References

  1. Agostino M. R., Aiello F. and Cardamone P. (2007) „Analysing the Impact of Trade Preferences in Gravity Models. Does Aggregation Matter?“, TRADEAG Working Paper 07/4. [Online]. Available: http://ageconsearch.umn.edu/bitstream/7294/2/wp070004.pdf [Accessed: Jan 20, 2015].
  2. Anderson, J. E. (1979) „A theoretical foundation for the gravity equation“, The American Economic Review, Vol. 69, No. 1, pp. 106-116. [Online]. Available: http://www.jstor.org/stable/1802501 [Accessed on: Jan 20, 2015]. ISSN 0002-8282.
  3. Baltagi, B. H (2005) „Econometric analysis of panel data“, England John Wiley & Sons Ltd. ISBN 10: 0470518863.
  4. Belwal, R. and Chala, M. (2008) „Catalysts and barriers to cut flower export: A case study of Ethiopian oriculture industry“, International Journal of Emerging Markets, Vol. 3, No. 2, pp. 216-235. ISSN 1746-8809. DOI 10.1108/17468800810862650.
  5. Cardoso, B. F., Bentivoglio, D., Giampietri, E. and Shikida, P. F. A. (2016) „What is behind the Italian coffee import? Investigating the most relevant dynamics“, Rivista di Economia Agraria, Vol. 71, No. 1, pp. 83-92. E-ISSN 2281-1559, ISSN 0035-6190. DOI 10.13128/REA-18379.
  6. CBI - Centre for the Promotion of Imports from developing countries (2016a) „CBI Trade Statistics: Cut Flowers and Foliage“, CBI Market Intelligence, Netherlands Ministry of Foreign Affairs. [Online]. Available: https://www.cbi.eu/sites/default/ les/market_information/researches/trade- statistics-cut- owers-foliage-2016.pdf [Accessed: May 15, 2015].
  7. CBI - Centre for the Promotion of Imports from developing countries (2016b) „CBI Trends: Flowers and Foliage in Europe“, CBI Market Intelligence, Netherlands Ministry of Foreign Affairs. [Online]. Available: https://www.cbi.eu/sites/default/ les/market_information/researches/trends- europe-cut- owers-foliage-2016.pdf [Accessed: May 15, 2015].
  8. CEPII - Centre d'Études Prospectives et d'Informations Internationales (2015) „CEPII distances and geographical database“. [Online]. Available: www.cepii.fr/anglaisgraph/bdd/distances.htm [Accessed: April 22, 2015].
  9. Cieślik, A. (2009) „Bilateral trade volumes, the gravity equation and factor proportions“, The Journal of International Trade & Economic Development, Vol. 18, No. 1, pp. 37-59. DOI 10.1080/09638190902757400.
  10. Cochrane, R. A. (1975) „A Possible Economic Basis for the Gravity Model“, Journal of Transport Economics and Policy, Vol. 9, No 1, pp. 34-49. [Online]. Available: http://www.bath.ac.uk/e- journals/jtep/pdf/Volume_1X_No_1_34-49.pdf [Accessed: Jan 15, 2015]. ISSN 0022-5258.
  11. Egger, P. (2002) „An econometric view on the estimation of gravity models and the calculation of trade potentials“, The World Economy, Vol. 25, No. 2, pp. 297-312. E-ISSN 1467-9701. DOI 10.1111/1467-9701.00432.
  12. EC - European Commission (2013) „Working document - Advisory Group Flowers and Ornamental Plants“, DG Agriculture and Rural Development (AGRI) Unit C.2, Bruxelles. [Online]. Available: https://ec.europa.eu/agriculture/sites/agriculture/ les/fruit-and-vegetables/product-reports/ owers/ statistics-2013_en.pdf. [Accessed: March 2015].
  13. Eurostat (2015) „Data Explorer - Europa“. [Online]. Available: http://appsso.eurostat.ec.europa.eu/ nui/submitViewTableAction.do. [Accessed: Jan 22, 2015].
  14. Frankel, J. A. (1997) „Regional trading blocs in the world economic system“, Institute for International Economics, Washington. ISBN: 9780881322026.
  15. Gebreeyesus, M. (2015) „Firms' adoption of international standards: Evidence from the Ethiopian oriculture sector“, Agricultural Economics, Vol. 46, No. S1, pp. 139-155. E-ISSN 1805-9295, ISSN 0139-570X. DOI 10.1111/agec.12203.
  16. Getu, M. (2009) „Ethiopian oriculture and its impact on the environment: regulation, supervision and compliance“, Mizan Law Review, Vol. 3, No. 2, pp. 241-270. DOI 10.4314/mlr.v3i2.54011.
  17. Giampietri, E., Finco, A. and Del Giudice, T. (2016a) „Exploring consumers’ behaviour towards short food supply chains“, British Food Journal, Vol. 118, No. 3, pp.618-631. ISSN 0007-070X. DOI 10.1108/BFJ-04-2015-0168.
  18. Giampietri, E., Koemle, D., Yu, X. and Finco, A. (2016b) „Consumers’ Sense of Farmers’ Markets: Tasting Sustainability or Just Purchasing Food?“, Sustainability, Vol. 8, No. 11, pp. 1157. DOI 10.3390/su8111157.
  19. Gujarati, D. (2004) „Basic econometrics“, The McGraw-Hill Companies. ISBN 10: 0070597936.
  20. Hausman, J. A. (1983) „Speci cation and estimation of simultaneous equation models“. In Z. Griliches & M. D. Intriligator (Eds.), Handbook of Econometrics, Vol. 1, pp. 391-448. North-Holland Publishing Company, Amsterdam. ISBN 10: 0444861858.
  21. ITC - International Trade Center (2016) „Floriculture sector at a glance“. [Online]. Available: http://www.intracen.org/itc/market-insider/ oriculture/at-a-glance/. [Accessed: April 15, 2016].
  22. Korovkin, T. (2003) „Cut-Flower exports, female labor and community participation in Highland Ecuador“, Latin American Perspectives, Vol. 30, No. 4, pp. 18-42. DOI 10.1177/0094582X03030004005.
  23. Lauricella, P. (2013) „Il mercato dei prodotti orovivaistici - Rilevazione“, ISMEA - Marzo 2013. [Online]. Available: http://www.ismea.it/ ex/ les/0/a/0/D.78f8df99401d6c240492/Marzo_13_ rev.00.pdf. [Accessed: May 12, 2015].
  24. Linnemann, H. (1966) „An econometric study of international trade ows“, North-Holland Publishing Company, Amsterdam.
  25. Lombardi, P., Dal Bianco, A., Freda, R., Caracciolo, F. and Cembalo, L. (2016) „Development and trade competitiveness of the European wine sector: A gravity analysis of intra-EU ows“, Wine Economics and Policy, Vol. 5, No. 1, pp. 50-59. ISSN 2212-9774. DOI 10.1016/j.wep.2015.12.002.
  26. McCallum, J. (1995) „National borders matter: Canada-US regional trade patterns“, American Economic Review, Vol. 85, No. 3, pp. 615-623. [Online]. Available: http://www.jstor.org/ stable/2118191. [Accessed: June 2015].
  27. Niedercorn, J. H. and Bechdolt Jr, B. V. (1969) „An economic derivation of the “gravity law” of spatial interaction“, Journal of Regional Science, Vol. 9, No. 2, pp. 273-282. ISSN 1467-9787. DOI 10.1111/j.1467-9787.1969.tb01340.x.
  28. Özzambak, M. E., Zeybekoğlu, E., Tuncay, O., Başer, S., Haspolat, G. and Olgun, A. (2009) „A survey on cut flower preferences and expectations“, Acta Horticulturae, Vol. 807, pp. 771-776. E-ISSN 2406-6168, ISSN 0567-7572. DOI 10.17660/ActaHortic.2009.807.117.
  29. Pietrzak, M. B. and Łapińska, J. (2015) „Determinants of the European Union’s trade - evidence from a panel estimation of the gravity model“, Ekonomie a Management, Vol. 18, No. 1, pp. 18-27. E-ISSN 1802-8934. DOI 10.15240/tul/001/2015-1-002.
  30. Raynolds, L. T. (2012) „Fair Trade Flowers: Global Certi cation, Environmental Sustainability, and Labor Standards“, Rural Sociology, Vol. 77, No. 4, pp. 493-519. E-ISSN 1549-0831. DOI 10.1111/j.1549-0831.2012.00090.x.
  31. Rihn, A., Yue, C., Behe, B. K. and Hall, C. R. (2015) „Consumer preferences for cut flower guarantees“, Acta Horticulturae, Vol. 1090, pp. 45-54. E-ISSN 2406-6168, ISSN 0567-7572. DOI 10.17660/ActaHortic.2015.1090.8.
  32. Rikken, M. (2010) „The European Market for Fair and Sustainable Flowers and Plants“, Belgian Development Agency (BTC) - Trade for Development Centre. [Online]. Available: http://www.befair.be/sites/default/ les/all- les/brochure/The%20European%20Market%20for%20 Fair%20and%20Sustainable%20Flowers%20and%20Plants_1.pdf. [Accessed: June 20, 2015].
  33. Sá Porto P. C. (2000) „Mercosul and Regional Development in Brazil: A Gravity Model Approach“. In: Fifth Latin American and Caribbean Economics Association (LACEA) Meeting, 2000, Rio de Janeiro. DOI 10.2139/ssrn.654423.
  34. Sánchez-Robles Rute, B., Martínez San Román, V. and Bengoa Calvo, M. (2012) „European Union and trade integration: does the home bias puzzle matter?“, Revista de Economía Mundial, Vol. 32, pp. 173-188. ISSN 1576-0162.
  35. Simwaka, K. (2006) „Dynamics of Malawi's trade ows: a gravity model approach“. MPRA Paper No. 1122, posted 11. [Online]. Available: http://mpra.ub.uni-muenchen.de/1122/. [Accessed: March 15, 2015].
  36. Sohn, C. H. (2005) „Does the gravity model t Korea’s trade patterns? Implications for Korea’s FTA policy and North-South Korean trade“. Center for International Trade Studies (CITS) Working Papers 2005-02. [Online]. Available: http://www.econ.ynu.ac.jp/cits/publications/pdf/ CITSWP2005-02.pdf. [Accessed: April 18, 2016].
  37. Staelens, L., Louche, C. and Haese, M. D. (2014) „Understanding job satisfaction in a labor intensive sector: Empirical evidence from the Ethiopian cut flower industry“. Paper prepared for presentation at the EAAE 2014 Congress ‘Agri-food and rural innovations for healthier societies’, 26-29 August, Ljubljana. [Online]. Available: http://purl.umn.edu/182815. [Accessed: May 2015].
  38. Starck S. C. (2012) „The theoretical foundation of gravity modeling: what are the developments that have brought gravity modeling into mainstream economics?“, Copenhagen Business School. [Online]. Available: http://studenttheses.cbs.dk/bitstream/handle/10417/3335/sarah_catherine_ starck.pdf?sequence=1. [Accessed: March 2016].
  39. The Swedish Chambers of Commerce (2011) „Market Report – Focus on the EU and Swedish Market – Floricultural Products“. Sida, Stockholm, Sweden. [Online]. Available: http://chambertradesweden.se/wp-content/uploads/2012/12/Flowers_EU_final_webb.pdf. [Accessed : June 2015].
  40. UNSD - United Nations Statistics Division (2015) „National accounts main aggregates database“. [Online]. Available: http://unstats.un.org/unsd/snaama/selbasicFast.asp. [Accessed: Feb 14, 2015].
  41. Van Den Broeck, G. and Maertens, M. (2016) „Horticultural exports and food security in developing countries“, Global Food Security, Vol. 10, pp. 11-20. ISSN 2211-9124. DOI 10.1016/j.gfs.2016.07.007.
  42. Van Rijswick, C. (2015) „World Floriculture Map 2015“, Rabobank Industry Note. [Online]. Available: https://www.rabobank.com/en/images/World_Floriculture_Map_2015_vanRijswick_ Jan2015.pdf. [Accessed: May 21, 2015].
  43. Wooldridge J. M. (2002) „Econometric analysis of cross section and panel data“. The MIT Press, Cambridge. ISBN 0-262-23219-7.

Full paper

  Full paper (.pdf, 508.07 KB).