What is the driving force of the macroeconomic fluctuations in Japan over the past forty years? To answer this question, we specify a structural vectorerror-correction model using combination of long-run and short-run restrictions. Especially by dividing the supply shocks such as neutral and...

Although geography has been considered as an important factor in international trades, the spatial heterogeneity has not been fully investigated in the regression of the standard gravity models. This paper contributes to the literature by investigating how the gravity in bilateral trades works...