Analysis of Gravity Model on the Relationship Between Foreign Trade and Immigration: The Case of Germany

With the transformation of countries into a more integrated structure through globalization, there has been a significant increase in the mobility of humans as well as volume of economic activities among countries. When the issue is considered within the scope of EU, it is seen that Germany is a center of attraction. As of 2017, it was observed that Germany was the country with the highest number of immigrants in the union and most of the migration was from CEE countries. In this context, the aim of this study is to examine whether the migration Germany got from CEE countries in the period of 2000-2016 has had an impact on the foreign trade of the country. As a result of analysis carried out with the panel gravity model, it has been found that the migration Germany got from the mentioned countries does not have a significant effect on the import and export of the country. On the other hand, it has been concluded that membership of origin countries to the Customs Union and GDP levels has a positive significant impact on Germany's export, whereas per capita, income levels of origin countries and distance between origin countries and Germany has a negative significant effect.