Analysis of New Zealand Exports to its trading partners through the gravity model during the period 2004 – 2022

Abstract

The objective of this work was to estimate a gravity model for New Zealand exports during the period 2004-2022 in order to establish the influence of economic and commercial variables, both internal and external, on the trade flow subject to study for the ten most important importing countries of that country's economy, which are: China, Australia, the United States, the United Kingdom, Thailand, Malaysia, Singapore, Indonesia, South Korea and Japan. The type of research is quantitative, descriptive and correlational in scope using macroeconomic aggregates in nominal terms and variables of the external sector, with secondary primary information sources. Among the findings is the fact that a 1% increase in New Zealand's GDP often leads to a decline in exports, which could be interpreted as a robust domestic economy absorbing more goods or as a shift in diversification of industries. exports to other international markets. On the other hand, economic growth in trading partner countries generally increases New Zealand's exports, highlighting these countries' demand for New Zealand products. It is concluded that the importance of understanding the interaction between the local economy and global markets and how economic growth, together with distance and diplomatic relations, shapes the landscape of international trade. As New Zealand seeks to expand its global market presence, these findings offer valuable insights for formulating effective business strategies and promoting inclusive and sustainable economic growth.

Keywords: Gravitational model, exports, partners, severity, GDP.