The European Bilateral Trade. An empirical analysis on the export flows between the Baltic States and the Nordic Countries

This thesis aims to investigate the trade intensity between the Baltic States and the Nordic countries over a period of 14 years. The bilateral exports of 42 European countries are explored with the focus on the Baltic-Nordic trade. Since many previous studies provided support for the strong relationship between the Baltic States and the Nordic countries, this thesis aims to explore this relationship over time. The Baltic States after their independence, shifted their trade to the Western economies, including Nordic countries. The results reveal that the magnitude of the trade intensity between these two regions have become more important and is higher than expected. Furthermore, it is accounted for commodities of different values traded between the Baltic States and the Nordic countries by introducing dummy variables. It has been shown that the value of commodities is not very important in the Baltic-Nordic trade and therefore there is no trend over time.