Date Added: Jan 2011
Recent literature on border effects has fostered research on informal barriers to trade and the role played by network dependencies. In relation to social networks, it has been shown that intensity of trade in goods is positively correlated with migration flows between pairs of countries/regions. In this paper the authors investigate if such a relation also holds for interregional trade of services, focusing on the case of the Spanish intra and interregional monetary flows generated by the domestic tourism sector. With this aim, they develop a gravity model that captures spatial and network dependence attributable to demographic linkages between regions.