Determinants of Romania’s Agri-Food Exports: A Gravity Model Approach Using Panel Data

Against the backdrop of growing trade, the importance of export competitiveness has become a major concern for both policymakers and researchers. Romania’s agri-food sector plays a major role in foreign trade, but export performance varies significantly, depending mainly on the destination market, thus reflecting the influence of economic size, demographic characteristics, geographical distance, and the level of economic integration. The main objective of this study is to identify the determinants of Romania’s agrifood exports by applying a gravity model to a panel data set covering 30 partner countries for the period 2005-2024. The methodology is based on estimating fixed effects models and applying standard specification tests, also using robust Driscoll Kraay standard errors to control heteroscedasticity, autocorrelation, and cross-sectoral dependence. The results support the fact that the economic size and population of the destination countries have a positive influence on Romania’s agri-food exports, while geographical distance acts as a restrictive factor on agri-food trade. Membership in the European Union (EU) has a positive and significant impact on trade flows, highlighting the role of regional integration. Overall, the study contributes to the literature by providing robust estimates of the determinants of Romania’s agri-food exports and highlights the importance of an appropriate econometric specification in the analysis of gravity models.