Intangible Barriers to International Trade: A Sectoral Approach
AbstractThis paper studies the importance of intangible barriers to trade in explaining variation in disaggregate international trade. The analysis is based on a sample of 55 countries for the year 2000. We explicitly focus on the importance of institutional and cultural dimensions of distance. Our results reveal there is substantial heterogeneity in the impact of intangible barriers for different product groups. More specifically, we find that cultural differences do not affect total trade significantly, whereas trade in homogeneous goods is significantly negatively affected. A possible explanation for this pattern is that the substitution effect between trade and FDI is stronger for more differentiated products.
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Bibliographic InfoPaper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 09-021/3.
Date of creation: 03 Mar 2009
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bilateral trade; gravity model; intangible barriers; cultural distance; sectoral trade;
Find related papers by JEL classification:
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
This paper has been announced in the following NEP Reports:
- NEP-ALL-2009-03-22 (All new papers)
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