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Travel Visas and Trade Finance

Veysel Avsar ()

Economics Bulletin, 2020, vol. 40, issue 1, 567-573

Abstract: We examine the impact of Turkey's removal of visa policies on trade finance using cross-country cross-industry payments data on international transactions. Exploiting the variation in visa requirements across countries and over time, we find that the removal of visa barriers significantly increases exporter-financed trade to Turkey. Our results suggest that easier personal interactions between global business partners as a result of liberal visa policies help them build trust and make it easier for them to monitor transactions and mitigate credit risks.

Keywords: Trade finance; travel visas; open account; method of payments in international trade; payment choice (search for similar items in EconPapers)
JEL-codes: F1 F3 (search for similar items in EconPapers)
Date: 2020-02-22
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