Economic Distance

In M21-S2 - Article - Distance Still Matters Economic distance relates to the difference in wealth or income of consumers in a Country. It is the most important economic attribute that creates distance between countries, and it has a marked effect on the levels of trade and the types of partners a country trades with.

Rich countries, research suggests, engage in relatively more cross-border economic activity relative to their economic size than do their poorer cousins. Most of this activity is with other rich countries, as the positive correlation between per capita GDP and trade flows implies. But poor countries also trade more with rich countries than with other poor ones.