Intangible Barriers to International Trade: A Sectoral Approach

Tinbergen Institute Discussion Paper 09-021/3

33 Pages Posted: 3 Mar 2009

See all articles by Jan L. Möhlmann

Jan L. Möhlmann

VU University Amsterdam; CPB Netherlands Bureau of Economic Policy Analysis

Sjef Ederveen

CPB Netherlands Bureau of Economic Policy Analysis

Henri L. F. de Groot

VU University Amsterdam - Department of Spatial Economics; Tinbergen Institute

Gert-Jan Linders

Ministry of Social Affairs and Employmen

Date Written: March 3, 2009

Abstract

This paper studies the importance of intangible barriers to trade in explaining variation in disaggregate international trade. The analysis is based on a sample of 55 countries for the year 2000. We explicitly focus on the importance of institutional and cultural dimensions of distance. Our results reveal there is substantial heterogeneity in the impact of intangible barriers for different product groups. More specifically, we find that cultural differences do not affect total trade significantly, whereas trade in homogeneous goods is significantly negatively affected. A possible explanation for this pattern is that the substitution effect between trade and FDI is stronger for more differentiated products.

Keywords: bilateral trade, gravity model, intangible barriers, cultural distance, sectoral trade

JEL Classification: F14

Suggested Citation

Mohlmann, Jan L. and Ederveen, Sjef and de Groot, Henri L.F. and Linders, Gert-Jan, Intangible Barriers to International Trade: A Sectoral Approach (March 3, 2009). Tinbergen Institute Discussion Paper 09-021/3, Available at SSRN: https://ssrn.com/abstract=1352265 or http://dx.doi.org/10.2139/ssrn.1352265

Jan L. Mohlmann (Contact Author)

VU University Amsterdam ( email )

De Boelelaan 1105
Amsterdam, ND North Holland 1081 HV
Netherlands

CPB Netherlands Bureau of Economic Policy Analysis ( email )

P.O. Box 80510
2508 GM The Hague, 2585 JR
Netherlands

Sjef Ederveen

CPB Netherlands Bureau of Economic Policy Analysis ( email )

P.O. Box 80510
2508 GM The Hague, 2585 JR
Netherlands
+31 70 33 83 373 (Phone)
+31 70 33 83 350 (Fax)

HOME PAGE: http://www.cpb.nl/eng/general/org/homepages/jpe/

Henri L.F. De Groot

VU University Amsterdam - Department of Spatial Economics ( email )

De Boelelaan 1105
Amsterdam, 1081 HV
Netherlands
+31 20 598 6168 (Phone)
+31 20 598 6004 (Fax)

Tinbergen Institute

Gustav Mahlerplein 17
Amsterdam, 1082 MS
Netherlands

Gert-Jan Linders

Ministry of Social Affairs and Employmen ( email )

Den Haag
Netherlands

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