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Travel and communication and international differences in GDP per capita

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  • Edward Anderson

    (Overseas Development Institute, London, UK)

Abstract

Economic theory predicts that wage and income levels will be higher in those developing countries to which business travel and telecommunication from developed countries is cheaper and easier. Cross-country regression analysis, using data from the World Tourism Organisation and the method of two-stage least squares, supports this prediction. Levels of per capita GDP are higher in those developing countries which receive higher inflows of business travel from other countries, even when controlling for other influences on per capita GDP with which those inflows are correlated. There is also evidence that governments in developing countries can attract higher inflows of business travel from developed countries by investing in travel and communications infrastructure. Copyright © 2006 John Wiley & Sons, Ltd.

Suggested Citation

  • Edward Anderson, 2007. "Travel and communication and international differences in GDP per capita," Journal of International Development, John Wiley & Sons, Ltd., vol. 19(3), pages 315-332.
  • Handle: RePEc:wly:jintdv:v:19:y:2007:i:3:p:315-332
    DOI: 10.1002/jid.1342
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    File URL: http://hdl.handle.net/10.1002/jid.1342
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    References listed on IDEAS

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    5. World Bank, 2004. "World Development Indicators 2004," World Bank Publications, The World Bank, number 13890, August.
    6. Daron Acemoglu & Simon Johnson & James A. Robinson, 2001. "The Colonial Origins of Comparative Development: An Empirical Investigation," American Economic Review, American Economic Association, vol. 91(5), pages 1369-1401, December.
    7. Adrian Wood, 2002. "Globalization and wage inequalities: A synthesis of three theories," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 138(1), pages 54-82, March.
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    Cited by:

    1. Robert Lawson & Jayme Lemke, 2012. "Travel visas," Public Choice, Springer, vol. 153(1), pages 17-36, October.
    2. Dowrick, Steve & Tani, Massimiliano, 2011. "International business visits and the technology frontier," Economics Letters, Elsevier, vol. 110(3), pages 209-212, March.
    3. Edward Anderson, 2014. "Time differences, communication and trade: longitude matters II," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(2), pages 337-369, May.

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