Modelling of Trade Relations between EU Countries by the Method of Minimum Spanning Trees

Abstract

The paper deals with the study of international flows of goods and services, modeling of the structure of trade relations between countries. The rapid development of international economic relations and the formation of various integration associations encourage the identification of structural links and their reformatting due to the influence of destabilizing factors. The study is based on one of the methods of cluster analysis, namely the method of construction of minimum spanning trees. The article analyzes the dynamics of European Union volumes for the period from 2000 to 2018. The influence of such factors as the integration of new member countries and the world financial crises on the structure of trade relations is substantiated. Changes in the structure of relations between the EU countries due to the influence of these factors are modeled. It is noted that there is a reformatting of links, especially in times of crisis, minimal spanning trees have more orderly structure. This can be used as an indicator of crisis phenomena. In addition, it has been proven that the accession of new member states to the EU leads to changes in the structure of trade relations that can be both positive and negative. The study has an applied nature and can be used in the future as a methodological basis for the development of effective mechanisms for reformatting trade relations between countries in the context of geo-economic transformations and global financial crises.