Empirical Analysis on the Influence Factors among RCEP Members in a Gravity Model

Abstract

Purpose - The purpose of this article is exploring the effect of the RCEP to jointly act against trade protectionism as the international public goods for trade cooperation among countries in the Pacific Rim. Design/Methodology/Approach - Based on the trade gravity model, this article studies the enhancement effect of RCEP on members’ trade potential. It also analyzes on current development needs of RCEP members with indices such as national competitiveness index and international business environment index and analyzes the influence of external environment for trade on the construction of RCEP based on the trade outlook indictor. Findings - This article illustrates the internal necessity of cooperation between RCEP members and analyzes the urgent influence of the deterioration of external trade environment on the construction of RCEP. The results of empirical analysis confirm that trade potential, among member economies increased notably after RCEP was proposed, exhibiting a trend to high trade potential from trade potential exploiting. Research Implications - This study has significance in developing deeper, practical and formal trade cooperation among RCEP members. It also provides some suggestions for China to actively participate in the construction of the RCEP.