This thesis reviews the border effect approach as an application of gravity models of trade and
different methods of including multilateral resistance terms (MRTs) in it. Some focus is laid
on the endogeneity problem of the approach. In an empirical application of the approach
agricultural trade between Turkey and the EU is analysed the effect of data pooling and
aggregation is studied the conversion of estimated border effects into ad-valorem tariff
equivalents (AVEs) reveals the crucial importance of a reliable measure of the elasticity of
substitution when trying to separate the effects of NTBs of the total effect of a border.
