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Political institutions and trade-evidence for the long-run relationship and causality

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  • Krenz, Astrid

Abstract

We examine the long-run effects of the political institutional framework, measured by the political risk component of the International Country Risk Guide, on trade. Our results suggest that an improved political institutional framework is both a cause and a consequence of increased trading activity. However, we find no significant relationship in case of exporting activity for the high-income countries and the countries that possess better political institutions.

Suggested Citation

  • Krenz, Astrid, 2013. "Political institutions and trade-evidence for the long-run relationship and causality," Center for European, Governance and Economic Development Research Discussion Papers 182, University of Goettingen, Department of Economics.
  • Handle: RePEc:zbw:cegedp:182
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    References listed on IDEAS

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    Cited by:

    1. Astrid Krenz & Ana Abeliansky, 2015. "Democracy and Trade—Evidence along the Distribution of Trading Activity," EcoMod2015 8750, EcoMod.

    More about this item

    Keywords

    political institutions; trade; cointegration analysis;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F55 - International Economics - - International Relations, National Security, and International Political Economy - - - International Institutional Arrangements

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