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Informal institutions and global trade: Real effects of the elusive

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  • Fujii, Eiji

Abstract

Countries increasingly participate in informal intergovernmental forums such as the G7, G20, BRICS, and MIKTA. Unlike formal bodies such as the EU and WTO, these informal institutions lack permanent administrative structures and operate without legally binding commitments. Despite their growing prominence, their role in shaping global trade remains insufficiently examined. This study investigates whether these forums reflect structural shifts in the global economy that materially affect trade flows. Using a gravity framework and a dataset covering more than 200 countries (1994–2023), we identify the trade–facilitating effects of informal institutions. Our results show that participation in BRICS, in particular, generates trade gains comparable to those associated with formal regional trade agreements or WTO accession. The findings reveal a novel channel of international economic integration that operates beyond legal commitments.

Suggested Citation

  • Fujii, Eiji, 2026. "Informal institutions and global trade: Real effects of the elusive," World Development, Elsevier, vol. 206(C).
    • Handle: RePEc:eee:wdevel:v:206:y:2026:i:c:s0305750x26001476
    DOI: 10.1016/j.worlddev.2026.107458
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    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

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