THE EFFECTS OF TERRORISM ON TRADE BETWEEN BRAZIL AND ITS MAIN COMMERCIAL PARTNERS

Alícia Cechin (), Carlos A. Charris () and Fernanda Aparecida Silva ()
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Alícia Cechin: Universidade Federal de Viçosa (UFV)
Carlos A. Charris: Universidade Federal de Viçosa (UFV)
Fernanda Aparecida Silva: Universidade Federal de Viçosa (UFV)

Revista de Economia Mackenzie (REM), 2021, vol. 18, issue 2, 34-59

Abstract: This paper examines the relationship between terrorist incidents and Brazilian bilateral trade with important trading partners. The method used in this work was the Poisson Pseudo Maximum Likelihood (PPML). We only considered, for their importance, bilateral trade between Brazil and the European Union, NAFTA and BRICs during the period from 2000 to 2016. We find a consistently negative relationship between terrorist acts and bilateral trade. These results are consistent with the idea that increases in terrorist incidents raise trade costs between countries. In addition, the relationships between bilateral trade and the set of variables that compose the gravitational model were examined. The results obtained are in accordance with this model.

Keywords: Trade; Terrorism; Gravitational Model (search for similar items in EconPapers)
JEL-codes: C01 F02 F10 (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:aft:journl:v:18:2:2021:jul:dec:p:34-59

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