Mark Thissen, Dario Diodato, and Frank van Oort (2013), PBL Netherlands Environmental Assessment Agency n.1035
This paper proposes a new methodology to determine interregional trade and present a unique data set on trade between 256 European NUTS2 regions, for the year 2000. The methodology stays close to a parameter-free approach as proposed by Simini et al. (2012), and deviates therefore from earlier methods based on the gravity model that suffer from analytical inconsistencies. Unlike a gravity model estimation, our methodology stays as close as possible to observed data without imposing any geographical trade patterns.