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Do Autocratic States Trade Less?

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  • Aidt, T.S.
  • Gassebner, M.

Abstract

The paper analyzes whether the political regime of a country inuences its involvement in international trade. Firstly, we develop a theoretical model that predicts that autocracies trade less than democracies. Secondly, we test the predictions of the model empirically using a panel of more than 130 countries for the years 1962 to 2000. In contrast to the existing literature, we use data on individual importing and exporting countries, rather than a dyadic set-up. In line with the model, we and that autocracies import substantially less than democracies, even after controlling for official trade policies. This finding is very stable and does not depend on a particular set-up or estimation technique.

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File URL: http://www.econ.cam.ac.uk/research/repec/cam/pdf/cwpe0742.pdf
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Bibliographic Info

Paper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 0742.

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Length: 24
Date of creation: Aug 2007
Date of revision:
Handle: RePEc:cam:camdae:0742

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Web page: http://www.econ.cam.ac.uk/index.htm

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Keywords: International trade; democracy; autocracy; gravity model.;

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