There are a large number of empirical studies that addresses the issue of trade
integration in the world and in the specific regions by using the gravity model. There
seem, however, to be few studies in which the trade integration in the Mekong region is
analyzed by the gravity model, although there has been a regional framework of
cooperation such as the GMS program. We herein represent the following two studies
that focused on the trade integration in the GMS: Poncet (2006), which adopted the
gravity model approach with the GMS dummy variables in international-trade context,
and Edmonds and Fujimura (2008), which applied the gravity model in the intra-GMS
for examining the impact of cross-border infrastructure. Poncet (2006) examined the
trade-integration evolution of Yunnan, i.e. Chinese province covered in the GMS, with
the other GMS economies and the other ASEAN countries, by estimating the gravity
trade model with their dummy variables between 1988 and 1999. He identified an
above-standard level of trade integration of Yunnan with the neighboring GMS
countries, e.g. Myanmar and Lao PDR, but, at the same time, found that its integration
with the neighboring GMS has decreased while the trade integration with other ASEAN
countries such as Singapore, Indonesia and Malaysia has increased. Edmonds and
Fujimura (2008) investigated the impact of cross-border road infrastructure on trade and
foreign direct investment in the intra-GMS, based on the gravity model estimation with
panel data from 1981 to 2003. They found that the development of cross-border road
infrastructure has had a positive effect on intra-GMS trade in major commodities, and
also reported that the results regarding the impact of road infrastructure on foreign
direct investment flows are ambiguous probably due to data limitations.