Product-Based Cultural Change: Is the Village Global?

51 Pages Posted: 7 Oct 2009

See all articles by Nicolas Maystre

Nicolas Maystre

UNCTAD - United Nations Conference on Trade and Development; Department of Economics - University of Geneva

Jacques Olivier

HEC Paris - Finance Department; Centre for Economic Policy Research (CEPR)

Mathias Thoenig

Ecole Nationale des Ponts et Chaussées (ENPC) - Centre d'Enseignement et de Recherche en Analyse Socio-Economique (CERAS); Centre for Economic Policy Research (CEPR); University of Geneva - Department of Political Economics

Thierry Verdier

Paris School of Economics (PSE); Delta - Ecole Normale Superieure (ENS); Centre for Economic Policy Research (CEPR)

Date Written: August 2009

Abstract

This paper makes three contributions to the growing literature on culture and economics. Using answers to the World Values Survey for a sample of 79 countries over the 1989-2004 period, we first provide evidence of cultural homogenization between countries. Second, we provide a model of product-based cultural change. Our main theoretical predictions are: (i) bilateral trade openness reduces bilateral cultural distance; (ii) the more differentiated the products, the more trade reduces cultural distance; (iii) trade openness has a lock-in effect on culture. Third, we test the model using an instrumental variable approach and including various time and country-pair fixed effects. We find that a one standard deviation increase in bilateral trade openness translates into a 43% standard deviation decrease in bilateral cultural distance.

Keywords: culture, homogenization, persistence, trade

JEL Classification: F10, O10, Z1

Suggested Citation

Maystre, Nicolas and Olivier, Jacques and Thoenig, Mathias and Verdier, Thierry, Product-Based Cultural Change: Is the Village Global? (August 2009). CEPR Discussion Paper No. DP7438. Available at SSRN: https://ssrn.com/abstract=1484470

Nicolas Maystre

UNCTAD - United Nations Conference on Trade and Development ( email )

Palais des Nations
Room: E 10028
Geneva, 1211
Switzerland
+41229171848 (Phone)

Department of Economics - University of Geneva ( email )

40, boulevard du Pont-d'Arve
Geneva 4, CH-1211
Switzerland

HOME PAGE: http://www.unige.ch/ses/dsec/staff/faculty/Maystre-Nicolas.html

Jacques Olivier (Contact Author)

HEC Paris - Finance Department ( email )

1 rue de la Liberation
Jouy-en-Josas Cedex, 78351
France
+33 1 3967 7297 (Phone)
+33 1 3967 7085 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Mathias Thoenig

Ecole Nationale des Ponts et Chaussées (ENPC) - Centre d'Enseignement et de Recherche en Analyse Socio-Economique (CERAS) ( email )

28, rue des Saints-Peres
75007 Paris
France
+33 1 4313 6380 (Phone)
+33 1 4313 6382 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

University of Geneva - Department of Political Economics ( email )

40 boulevard du Pont-d'Arve
Geneva 4, CH-1211
Switzerland
+41 22 379 8274 (Phone)
+41 22 379 8293 (Fax)

Thierry Verdier

Paris School of Economics (PSE) ( email )

48 Boulevard Jourdan
Paris, 75014
France

Delta - Ecole Normale Superieure (ENS) ( email )

48, Boulevard Jourdan
75014 Paris
France
+33 1 4313 6308 (Phone)
+33 1 4313 6310 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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