Migration And International Trade Of Asian Developing Countries: Theoretical And Empirical Analysis

The theoretical model in this paper is based on the model that developed by Silvio(2009)and combines the factor of institution to create a two-step game model in order to explore the relationship between the migration and the international trade. The theoretical model finds that migration can substitute for the weak institution. Besides, we introduce the new variable terms including GDP、distance、contiguity、language and colony in the gravity model. We use the trade data from 215 countries in the world in 2010, the migration data, the space distance data and the cultural distance data to have empirical analysis. We test four different empirical models and choose the two-country special effect model. And we use the OLS+White method. The result indicates that migration have a significantly positive effect on the international export trade and the import trade for the home country. The migration can substitute for the weak institution and it changes when the product is different.