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The Foreign Service and Foreign Trade: Embassies as Export Promotion

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Author Info
Andrew K. Rose

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Abstract

As communication costs fall, foreign embassies and consulates have lost much of their role in decision-making and information-gathering. Accordingly, foreign services are increasingly marketing themselves as agents of export promotion. I investigate whether exports are in fact systematically associated with diplomatic representation abroad. I use a recent cross-section of data covering 22 large exporters and 200 import destinations. Bilateral exports rise by approximately six to ten per cent for each additional consulate abroad, controlling for a host of other features including reverse causality. The effect varies by exporter, and is non-linear; consulates have smaller effects than the creation of an embassy. Copyright 2007 Blackwell Publishers Ltd (a Blackwell Publishing Company).

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File URL: http://www.blackwell-synergy.com/links/doi/10.1111/j.1467-9701.2007.00870.x/enhancedabs
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Publisher Info
Article provided by Blackwell Publishing in its journal World Economy.

Volume (Year): 30 (2007)
Issue (Month): 1 (01)
Pages: 22-38
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Handle: RePEc:bla:worlde:v:30:y:2007:i:1:p:22-38

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  1. Rubén Segura-Cayuela & Josep M. Vilarrubia, 2008. "The effect of foreign service on trade volumes and trade partners," Banco de España Working Papers 0808, Banco de España. [Downloadable!]
  2. Lederman, Daniel & Olarreaga, Marcelo & Payton, Lucy, 2006. "Export Promotion Agencies: What Works and What Doesn't," CEPR Discussion Papers 5810, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  3. Kai A. Konrad, 2007. "Mobile Tax Base as a Global Common," CESifo Working Paper Series CESifo Working Paper No. , CESifo GmbH. [Downloadable!]
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  4. Rubén Segura-Cayuela & Josep M. Vilarrubia, 2008. "Uncertainty and entry into export markets," Banco de España Working Papers 0811, Banco de España. [Downloadable!]
  5. Volker Nitschr, 2007. "State Visits and International Trade," Working Papers 032007, Hong Kong Institute for Monetary Research. [Downloadable!]
  6. Moser, Christoph & Nestmann, Thorsten & Wedow, Michael, 2006. "Political risk and export promotion: evidence from Germany," Discussion Paper Series 1: Economic Studies 2006,36, Deutsche Bundesbank, Research Centre. [Downloadable!]
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