Management potential of an international trade network based on cointegration analysis

This article investigates whether cointegration approach can be the basis of an international trade network and whether such a network is relevant for analysis. We fit data on international-trade flows with a cointegration specification using cointegration approach. In addition, we use the force algorithm of Kamada and Kawai for replicating the weighted international trade network. We find that the cointegration approach in combination with the Kamada and Kawai algorithm successfully replicates the weighted international trade network structure.