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Do Leader’s Visits Increase Trade Flows?

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  • Kodila-Tedika, Oasis
  • Khalifa, Sherif

Abstract

This paper examines the effect of the number of visits by U.S. officials to a country, and the number of visits of the country’s leaders to the United States, on bilateral trade flows between the country and the United States. To achieve our objective, we compile novel variables that indicate the number of official visits from 1960-2015 from the historical archives of the U.S. State Department. To deal with potential endogeneity, we use instrumental variables panel data techniques such as dynamic GMM and systems GMM estimations. The estimation results show that the visits by U.S. Presidents and Secretaries of State do not have a statistically significant effect on bilateral trade flows, while the leader’s trips to the United States have a statistically significant positive effect. This indicates that the leader’s trips to the United States are taken as an opportunity to promote free bilateral trade flows between the country and the United States, while the visits of American officials focus on other issues.

Suggested Citation

  • Kodila-Tedika, Oasis & Khalifa, Sherif, 2021. "Do Leader’s Visits Increase Trade Flows?," MPRA Paper 105577, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:105577
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    File URL: https://mpra.ub.uni-muenchen.de/105577/1/MPRA_paper_105577.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Trade; Executive; Leader’s Trips;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • H11 - Public Economics - - Structure and Scope of Government - - - Structure and Scope of Government

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