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Why do OECD-Countries trade more?

Author

Listed:
  • Henri L.F. de Groot

    (Faculty of Economics and Business Administration, Vrije Universiteit Amsterdam)

  • Gert-Jan Linders

    (Faculty of Economics and Business Administration, Vrije Universiteit Amsterdam)

  • Piet Rietveld

    (Faculty of Economics and Business Administration, Vrije Universiteit Amsterdam)

Abstract

Ineffective institutions increase transaction costs and reduce trade. This paper shows that differences in the effectiveness of institutions offer an explanation for the tendency of OECD countries to trade disproportionately with each other, and with non-OECD countries.

Suggested Citation

  • Henri L.F. de Groot & Gert-Jan Linders & Piet Rietveld, 2003. "Why do OECD-Countries trade more?," Tinbergen Institute Discussion Papers 03-092/3, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20030092
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    References listed on IDEAS

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    5. Henri L. F. De Groot & Gert‐Jan Linders & Piet Rietveld & Uma Subramanian, 2004. "The Institutional Determinants of Bilateral Trade Patterns," Kyklos, Wiley Blackwell, vol. 57(1), pages 103-123, February.
    6. Kaufmann, Daniel & Kraay, Aart & Zoido-Lobaton, Pablo, 2002. "Governance matters II - updated indicators for 2000-01," Policy Research Working Paper Series 2772, The World Bank.
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    11. Andrew Rose, 2005. "Which International Institutions Promote International Trade?," Review of International Economics, Wiley Blackwell, vol. 13(4), pages 682-698, September.
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    Citations

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    Cited by:

    1. Karam, Fida & Zaki, Chahir, 2019. "Why Don’t MENA Countries Trade More? The Curse of Deficient Institutions," The Quarterly Review of Economics and Finance, Elsevier, vol. 73(C), pages 56-77.
    2. Fetzer, James J. & Rivera, Sandra A., 2005. "Modeling Modifications in Rules of Origin: A Partial Equilibrium Approach," Conference papers 331372, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    3. Jansen, Marion & Nordås, Hildegunn Kyvik, 2004. "Institutions, trade policy and trade flows," WTO Staff Working Papers ERSD-2004-02, World Trade Organization (WTO), Economic Research and Statistics Division.
    4. Chahir Zaki & Fida Karam, 2017. "Why Don’t MENA Countries Trade More? The Curse of Bad Institutions," Working Papers 1148, Economic Research Forum, revised 10 2003.
    5. Tamer Afifi, 2006. "Institutional Reform: a Step Towards Free Trade in Egypt," EcoMod2006 272100001, EcoMod.
    6. Suzanna-Maria Paleologou, 2016. "The long-run tendency of government expenditure: a semi-parametric modelling approach," Empirical Economics, Springer, vol. 50(3), pages 753-776, May.
    7. Adeolu O. Adewuyi & Ebenezer Olubiyi, 2020. "Do Governance Institutions Matter for Trade Flows between Sub-Saharan Africa and its Trading Partners?," Working Papers 376, African Economic Research Consortium, Research Department.

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    More about this item

    Keywords

    bilateral trade; gravity model; institutions; OECD;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

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