Trade Networks and Colonial Trade Spillovers

33 Pages Posted: 11 Aug 2017

See all articles by Antoine Berthou

Antoine Berthou

Université Paris I Panthéon-Sorbonne - Centre Maison des Sciences Economiques; Paris School of Economics (PSE)

Hélène Ehrhart

Agence Française de Développement (AFD)

Multiple version iconThere are 2 versions of this paper

Date Written: September 2017

Abstract

This paper provides new empirical evidence regarding the formation of international trade networks. Established trade relations may open the gate to new trade opportunities, as they allow meeting new trade partners over time. We test this prediction and its implications for aggregate trade patterns by using the experience of ancient trade linkages between former colonies and their former colonizers (colonial trade linkages). We first show, using aggregate trade data, that former colonies have more trade with former colonizer's neighbors (colonial trade spillovers). We then show that the past export and import experience of former colonies with the colonizer have an impact on the propensity to trade similar products with third countries. In particular, the trade spillover effect is negatively related to geographical distance between third countries and the colonizer, and positively affected by their degree of economic integration.

Keywords: international trade dynamics, networks formation, colonies

JEL Classification: F14, F15

Suggested Citation

Berthou, Antoine and Ehrhart, Hélène, Trade Networks and Colonial Trade Spillovers (September 2017). Review of International Economics, Vol. 25, Issue 4, pp. 891-923, 2017, Available at SSRN: https://ssrn.com/abstract=3016711 or http://dx.doi.org/10.1111/roie.12288

Antoine Berthou (Contact Author)

Université Paris I Panthéon-Sorbonne - Centre Maison des Sciences Economiques ( email )

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Paris Cedex 13, 75647
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(+33)144078211 (Phone)

Paris School of Economics (PSE) ( email )

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Paris, 75014 75014
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Hélène Ehrhart

Agence Française de Développement (AFD) ( email )

5, rue Roland Barthes
Paris Cedex 12, 75598
France

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