Free Trade Agreements and the Movement of Business People

Abstract

Using provisions to ease the movement of business visitors in trade agreements, we show that removing barriers to the movement of business people promotes trade. We document the increasing complexity of Free Trade Agreements and develop an algorithm that combines machine learning and text analysis techniques to examine the content of FTAs. We use the algorithm to determine which FTAs include provisions to facilitate the movement of business people and whether these are included in dispute settlement mechanisms. We show that provisions facilitating business travel are eective in promoting them and eventually increase bilateral trade flows.

Keywords: migration, business travel, free trade agreements, machine learning, text analysis

JEL Classification: F13, F22, F23