Identifying the Community Structure of the International-Trade Multi Network

TL;DR

This paper analyzes the community structures within the international trade network across different commodities and time periods, revealing heterogeneity, fragmentation, and the influence of geographical distance over trade agreements.

Contribution

It provides a comparative analysis of commodity-specific trade communities and their evolution, highlighting the impact of geography versus trade agreements.

Findings

Commodity-specific communities are highly heterogeneous and fragmented.

Chemical sector communities are increasingly similar to the aggregate network.

Geographical distance correlates more strongly with community structure than RTAs.

Abstract

We study the community structure of the multi-network of commodity-specific trade relations among world countries over the 1992-2003 period. We compare structures across commodities and time by means of the normalized mutual information index (NMI). We also compare them with exogenous community structures induced by geographical distances and regional trade agreements. We find that commodity-specific community structures are very heterogeneous and much more fragmented than that characterizing the aggregate ITN. This shows that the aggregate properties of the ITN may result (and be very different) from the aggregation of very diverse commodity-specific layers of the multi network. We also show that commodity-specific community structures, especially those related to the chemical sector, are becoming more and more similar to the aggregate one. Finally, our findings suggest that geographical distance is much more correlated with the observed community structure than RTAs. This result strengthens previous findings from the empirical literature on trade.