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Time zone differences as trade barriers

Author

Listed:
  • Egger, Peter H.
  • Larch, Mario

Abstract

This paper estimates the impact of time zone differences between trading locations on trade costs and trade in general equilibrium. Using homogeneous bilateral trade data between US states and Canadian provinces, time zone differences are found to reduce bilateral trade by 11% on average, which amounts to about one-sixth of the international border effect between the US and Canada.

Suggested Citation

  • Egger, Peter H. & Larch, Mario, 2013. "Time zone differences as trade barriers," Economics Letters, Elsevier, vol. 119(2), pages 172-175.
  • Handle: RePEc:eee:ecolet:v:119:y:2013:i:2:p:172-175
    DOI: 10.1016/j.econlet.2013.02.016
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    References listed on IDEAS

    as
    1. Stein, Ernesto & Daude, Christian, 2007. "Longitude matters: Time zones and the location of foreign direct investment," Journal of International Economics, Elsevier, vol. 71(1), pages 96-112, March.
    2. Elisabeth Christen, 2017. "Time Zones Matter: The Impact of Distance and Time Zones on Services Trade," The World Economy, Wiley Blackwell, vol. 40(3), pages 612-631, March.
    3. James E. Anderson & Eric van Wincoop, 2003. "Gravity with Gravitas: A Solution to the Border Puzzle," American Economic Review, American Economic Association, vol. 93(1), pages 170-192, March.
    4. Bianka Dettmer, 2014. "International Service Transactions: Is Time a Trade Barrier in a Connected World?," International Economic Journal, Taylor & Francis Journals, vol. 28(2), pages 225-254, June.
    5. McCallum, John, 1995. "National Borders Matter: Canada-U.S. Regional Trade Patterns," American Economic Review, American Economic Association, vol. 85(3), pages 615-623, June.
    6. repec:ebl:ecbull:v:6:y:2006:i:15:p:1-10 is not listed on IDEAS
    7. Toru Kikuchi, 2006. "Time Zones, Outsourcing and Patterns of International Trade," Economics Bulletin, AccessEcon, vol. 6(15), pages 1-10.
    8. Jonathan Eaton & Samuel Kortum, 2002. "Technology, Geography, and Trade," Econometrica, Econometric Society, vol. 70(5), pages 1741-1779, September.
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    Citations

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    Cited by:

    1. Elisabeth Christen, 2017. "Time Zones Matter: The Impact of Distance and Time Zones on Services Trade," The World Economy, Wiley Blackwell, vol. 40(3), pages 612-631, March.
    2. Karl Benediktsson & Stanley D. Brunn, 2015. "Time Zone Politics and Challenges of Globalisation," Tijdschrift voor Economische en Sociale Geografie, Royal Dutch Geographical Society KNAG, vol. 106(3), pages 276-290, July.
    3. Brei, Michael & von Peter, Goetz, 2018. "The distance effect in banking and trade," Journal of International Money and Finance, Elsevier, vol. 81(C), pages 116-137.

    More about this item

    Keywords

    Trade costs; Time zones; Bilateral trade;

    JEL classification:

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

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