THE GRAVITY TRADE MODEL FOR UZBEKISTAN

The generalized gravity model is used to analyze the trade between Uzbekistan and its main trading partners using the panel data estimate technique, and an attempt is made to establish a theoretical rationale for its use in the analysis of bilateral trade. The gravity model of commerce (the total of exports and imports), the gravity model of export, and the gravity model of import have all been estimated. Our findings indicate that the size of the economies, differences in per capita GNP, and openness of the trading nations all favorably influence trade with Uzbekistan. Uzbekistan’s exports are mostly determined by the exchange rate, overall import demand from partners, and Uzbekistan’s economic openness. Positive effects on Uzbekistan’s exports are caused by all three elements. Contrarily, the exchange rate has no bearing on Uzbekistan’s imports, which are instead influenced by the inflation rates, disparities in per capita income, and trade openness of the participating nations. It has been discovered that the cost of transportation significantly affects Uzbekistan’s trade negatively. The border between Uzbekistan and Kazakstan is also proven to have a significant impact on imports into Uzbekistan. The country-specific impacts demonstrate that Uzbekistan would prosper more if it increased trade with its neighbors. Factors associated with multilateral barriers favorably impact Uzbekistan’s exports and trade.