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Country Image and International Trade


  • Pao-li CHANG

    () (School of Economics, Singapore Management University)

  • Tomoki Fujii

    () (School of Economics, Singapore Management University)


We study the impact of country image on international trade flows. We find that a one percentage point increase in the positive response ratio – the proportion of people in the importing country who view the exporting country positively – is associated with at least a one percent increase in the aggregate trade flow. By disaggregating trade flows by type of goods, we also find that both homogeneous and differentiated goods are positively affected by better country image and that the impact of country image tends to be larger when more substitutes are available in the international market.

Suggested Citation

  • Pao-li CHANG & Tomoki Fujii, 2012. "Country Image and International Trade," Working Papers 29-2012, Singapore Management University, School of Economics.
  • Handle: RePEc:siu:wpaper:29-2012

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    References listed on IDEAS

    1. Hwee Kwan Chow, 2004. "A VAR Analysis of Singapore’s Monetary Transmission Mechanism," Working Papers 19-2004, Singapore Management University, School of Economics.
    2. Guillermo A. Calvo & Carmen M. Reinhart, 2002. "Fear of Floating," The Quarterly Journal of Economics, Oxford University Press, vol. 117(2), pages 379-408.
    3. Marco Del Negro & Frank Schorfheide, 2004. "Priors from General Equilibrium Models for VARS," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 45(2), pages 643-673, May.
    4. Michael B. Devereux, 2003. "A Tale of Two Currencies: the Asian Crisis and the Exchange Rate Regimes of Hong Kong and Singapore," Review of International Economics, Wiley Blackwell, vol. 11(1), pages 38-54, February.
    5. Sungbae An & Heedon Kang, 2011. "Oil Shocks in a DSGE Model for the Korean Economy," NBER Chapters,in: Commodity Prices and Markets, East Asia Seminar on Economics, Volume 20, pages 295-321 National Bureau of Economic Research, Inc.
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