| Abstract: | Picture a small open economy, alone in the middle of the Atlantic Ocean and highly dependent on trade with NAFTA and the EU. How important are these trading blocs to the country’s exports? How significant is the country’s isolation and small size, and how do these affect the export sectors? Typically, the export volume is significantly impacted by the economic size of the exporting country, but in this case it is not. This suggests that the exports from small remote economies are driven by different factors than exports from large economies. The data are analysed using a unique transformation of the gravity model by an inverse hyperbolic sine function, allowing for accountancy of scattered exports. |
