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The Foreign Service and Foreign Trade: Embassies as Export Promotion

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Rose, Andrew K

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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 6-10% 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.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 4953.

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Date of creation: Mar 2005
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Handle: RePEc:cpr:ceprdp:4953

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Related research
Keywords: consulate; country; data; destination; empirical; gravity; import; international; panel;

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Find related papers by JEL classification:
F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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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)
    Other versions:
  3. González-Val, Rafael & Lanaspa, Luis & Pueyo, Fernando, 2009. "Trade policies, concentration, growth and welfare," MPRA Paper 9730, University Library of Munich, Germany. [Downloadable!]
  4. Kai A. Konrad, 2007. "Mobile Tax Base as a Global Common," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
    Other versions:
  5. Rubén Segura-Cayuela & Josep M. Vilarrubia, 2008. "Uncertainty and entry into export markets," Banco de España Working Papers 0811, Banco de España. [Downloadable!]
  6. Volker Nitschr, 2007. "State Visits and International Trade," Working Papers 032007, Hong Kong Institute for Monetary Research. [Downloadable!]
  7. Mina Yakop & Peter A.G. van Bergeijk, 2009. "The weight of economic and commercial diplomacy," Working Papers - General Series 478, Institute of Social Studies. [Downloadable!]
  8. 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!]
    Other versions:
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