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Visible and invisible walls: World trade patterns and the end of the Cold War

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  • Peter A. G. van Bergeijk

    (International Institute of Social Studies of Erasmus University)

Abstract

This paper revisits the empirical trade literature on East–West trade in the early 1990s and provides a replication of the traditional gravity findings of that period with the Baier–Bergstrand version of the model, providing thereby better estimates of the trade hindering impact of the Cold War by including multilateral and world resistance factors and simultaneously considering country fixed effects. Breaking down the Cold War Walls increased world trade by 2.7% of world GDP. The replication with the Baier–Bergstrand model also reveals that Cold War trade distortions also significantly impacted China’s trade with the West.

Suggested Citation

  • Peter A. G. van Bergeijk, 2015. "Visible and invisible walls: World trade patterns and the end of the Cold War," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 65(2), pages 231-247, June.
    • Handle: RePEc:aka:aoecon:v:65:y:2015:i:2:p:231-247
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    Cited by:

    1. Rodolfo G. Campos & Benedikt Heid & Jacopo Timini, 2024. "The economic consequences of geopolitical fragmentation: Evidence from the Cold War," Papers 2404.03508, arXiv.org.
    2. (ed.), 0. "Research Handbook on Economic Diplomacy," Books, Edward Elgar Publishing, number 16053, August.
    3. Peter A.G. van Bergeijk, 2019. "Deglobalization 2.0," Books, Edward Elgar Publishing, number 18560, August.
    4. Fabio Ascione & Maria Enrica Virgillito, 2023. "Vertical integration and patterns of divergence in European industries: A long-term input-output analysis," LEM Papers Series 2023/25, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    5. Kamwela, V.K. & van Bergeijk, P.A.G., 2020. "The border walls of (de)globalization," ISS Working Papers - General Series 123704, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.

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    Keywords

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    JEL classification:

    • F5 - International Economics - - International Relations, National Security, and International Political Economy
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • N74 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: 1913-

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