The Importance of Distance Measurement for Intra-African Trade Flow in Context of Gravity Models

Abstract:

According to the Agenda 2063 published by African Union, one of the main challenges for Africa in the 21st century is to carry out the process of economic integration, the manifestation of which may be the development of intra-African trade. In economic sciences, one of the most popular methods to determine the forces of interaction of various economic actors on each other is using gravity models. Although these models have been used in many studies, one of the still returning problems is the determination of the distance indicator. Proper identification of the distance measures used is critical for the correct application of gravity models. The aim of these paper was to present potential and to explain various methods of road distance measurement on example of mainland African countries. The study confirms previous findings that distance is significant limiting factor for intra-African trade. Study also finds that that despite general development and urbanization processes on the African continent, capitals should be still the point of reference used in gravity models. A necessity to draw more attention for road distance in further studies devoted to use gravity models in pursuit to explain intra-African trade flows was also noticed.