Article Sidebar
Views PDF: 522
Metrics
Effects of logistics performance on Vietnam’s exports: a quantitative analysis using the PPML method
Main Article Content
Abstract
This study aims to analyze the effects of logistics performance on Vietnam’s exports at both the overall level and in specific aspects. We investigate the linkage between logistics performance and Vietnam’s exports based on a panel of bilateral trade from Vietnam to 158 trading partners from 2007 to 2018. Using the Poisson pseudo-maximum likelihood method, the positive and significant effects of Vietnam’s and importing countries’ logistics performance on exports are identified. Our estimates become highly consistent after controlling for both time-specific effects and time-invariant country-fixed effects and remain robust to changes in the model specification, contributing reliable empirical evidence to the literature. Considering the specific aspects of logistics performance, we find the significant roles of the ability to track and trace consignments, the quality of logistics services, the customs clearance efficiency, and the timeliness of shipments in trade. From Vietnam’s perspective, improvements in tracking and tracing ability and timeliness can enhance exports to other countries, with larger effects than those of trading partners. Based on these findings, this study provides evidence for policymakers to effectively enhance trade with other countries by developing the national logistics system alongside further logistics cooperation with trading partners and with a greater focus on tracking and tracing ability and timeliness.
Article Details
This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License.
Keywords
Logistics performance, Vietnam’s exports, Gravity model, Poisson pseudo-maximum likelihood
References
Abreo, C., Bustillo, R. and Rodriguez, C. (2021), “The role of institutional quality in the international trade of a Latin American country: evidence from Colombian export performance”, Journal of Economic Structures, Vol. 10 No. 1, 24.
Allen, T., Arkolakis, C. and Takahashi, Y. (2020), “Universal gravity”, Journal of Political Economy, Vol. 128 No. 2, pp. 393 - 433.
Alvarez, I.C., Barbero, J., Rodriguez-Pose, A. and Zofio, J.L. (2018), “Does institutional quality matter for trade? Institutional conditions in a sectoral trade framework”, World Development, Vol. 103, pp. 72 - 87.
Anderson, J.E. (1979), “A theoretical foundation for the gravity equation”, The American Economic Review, Vol. 69 No. 1, pp. 106 - 116.
Anderson, J.E. and van Wincoop, E. (2003), “Gravity with gravitas: a solution to the border puzzle”, American Economic Review, Vol. 93 No. 1, pp. 170 - 192.
Anwar, S. and Nguyen, L. (2010), “Foreign direct investment and economic growth in Vietnam”, Asia Pacific Business Review, Vol. 16, pp. 183 - 202.
Baltagi, B.H. (2021), Econometric analysis of panel data, Springer International Publishing, Cham.
Christopher, M. (2016), Logistics and supply chain management, 5th Edition, Pearson, London.
Conte, M., Cotterlaz, P. and Mayer, T. (2022), “The CEPII gravity database”, CEPII Working Paper No. 2022-05, The Centre d’Etudes Prospectives et d’Informations Internationales, Paris.
CSCMP. (n.d.), “Definition of logistics management”, Available at https://cscmp.org/CSCMP/Educate/SCM_Definitions_and_Glossary_of_Terms.aspx (Accessed 26 September, 2023).
Egger, P.H. and Nigai, S. (2015), “Structural gravity with dummies only: constrained ANOVA-type estimation of gravity models”, Journal of International Economics, Vol. 97 No. 1, pp. 86 - 99.
Head, K. and Mayer, T. (2014), “Gravity equations: workhorse, toolkit, and cookbook”, Handbook of International Economics, Vol. 4, pp. 131 - 195.
Hummels, D. (2007), “Transportation costs and international trade in the second era of globalization”, Journal of Economic Perspectives, Vol. 21 No. 3, pp. 131 - 154.
Huynh, L.T.D. (2021), “The importance of logistics to Vietnam’s exports”, Journal of Economics and Development, Vol. 290, pp. 23 - 33.
Kahouli, B. (2016), “Regional integration agreements, trade flows and economic crisis: a static and dynamic gravity model”, International Economic Journal, Vol. 30 No. 4, pp. 450 - 475.
Krugman, P.R., Maurice, O. and Melitz, M.J. (2018), International economics: theory and policy, 11th Edition, Pearson, New York.
Le, D.N. (2021), “Globalization, logistics and food supply: evidence from Vietnam”, Malaysian Journal of Economic Studies, Vol. 58 No. 2, pp. 267 - 291.
Le, D.N. (2022), “Export, logistics performance, and regional economic integration: sectoral and sub-sectoral evidence from Vietnam”, Journal of International Logistics and Trade, Vol. 20 No. 1, pp. 37 - 56.
Le, D.N. (2023), “Gender equality, institution, logistics performance, and international trade: the case of Vietnamese agriculture sector”, Journal of International Economics and Management, Vol. 152, pp. 1 - 20.
Le, T.N.P. and Nguyen, K.H. (2022), “Determinants of bilateral trade flows of Vietnam: evidence from panel fixed effects estimation approaches”, Journal of International Economics and Management, Vol. 22 No. 2, pp. 84 - 102.
Leszczensky, L. and Wolbring, T. (2022), “How to deal with reverse causality using panel data? Recommendations for researchers based on a simulation study”, Sociological Methods & Research, Vol. 51 No. 2, pp. 837 - 865.
Marti, L., Puertas, R. and Garcia, L. (2014), “The importance of the logistics performance index in international trade”, Applied Economics, Vol. 46 No. 24, pp. 2982 - 2992.
Motta, V. (2019), “Estimating Poisson pseudo-maximum-likelihood rather than log-linear model of a log-transformed dependent variable”, RAUSP Management Journal, Vol. 54 No. 4, pp. 508 - 518.
Puertas, R., Marti, L. and Garcia, L. (2014), “Logistics performance and export competitiveness: European experience”, Empirica, Vol. 41 No. 3, pp. 467 - 480.
Santos Silva, J.M.C. and Tenreyro, S. (2011), “Further simulation evidence on the performance of the Poisson pseudo-maximum likelihood estimator”, Economics Letters, Vol. 112 No. 2, pp. 220 - 222.
Silva, J.M.C.S. and Tenreyro, S. (2006), “The log of gravity”, The Review of Economics and Statistics, Vol. 88 No. 4, pp. 641 - 658.
Soh, K.L., Wong, W.P. and Tang, C.F. (2021), “The role of institutions at the nexus of logistic performance and foreign direct investment in Asia”, The Asian Journal of Shipping and Logistics, Vol. 37 No. 2, pp. 165 - 173.
Song, M.-J. and Lee, H.-Y. (2022), “The relationship between international trade and logistics performance: a focus on the South Korean industrial sector”, Research in Transportation Business & Management, Vol. 44, 100786.
Tinbergen, J. (1962), Shaping the world economy, suggestions for an international economic policy, The Twentieth Century Fund, New York.
Tran, M.N., Cao, L.T.K., Quach, H.T. and Phan, V.T.T. (2023), “Impact of green logistics performance on Vietnam’s export trade to Regional Comprehensive Economic Partnership countries”, Journal of Trade Science, Vol. 178, pp. 31 - 39.
Wilson, J.S., Mann, C.L. and Otsuki, T. (2003), “Trade facilitation and economic development: a new approach to quantifying the impact”, The World Bank Economic Review, Vol. 17 No. 3, pp. 367 - 389.
Wooldridge, J.M. (2020), Introductory econometrics: a modern approach, 7th Edition, Cengage, Boston.
World Bank Vietnam Office. (2023), “Vietnam economic update presentation - August 10”, Available at https://thedocs.worldbank.org/en/doc/29e4ae631f67158a4e5fc0eec05ad7ee-0070012023/vietnam-economic-update-presentation-august-10 (Accessed 13 October, 2023).
Zaninovic, P.A., Zaninovic, V. and Skender, H.P. (2021), “The effects of logistics performance on international trade: EU15 vs CEMS”, Economic Research-Ekonomska Istraživanja, Vol. 34 No. 1, pp. 1566 - 1582.