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Cultural distance and international trade in services: A disaggregate view

Philipp Harms and Daria Shuvalova

Economic Systems, 2020, vol. 44, issue 2

Abstract: In this paper, we estimate the effect of “cultural distance” on bilateral trade in services. The measure of cultural distance we use is based on scores that reflect country averages of individuals’ attitudes towards inequality, self-orientation, competition, uncertainty, traditions, and indulgence. Controlling for standard ingredients of gravity equations, we show that an aggregate measure of cultural distance has a significantly negative effect on total bilateral services trade. Once we take a more disaggregate view, we find that the strength of this effect differs across various types of services and various aspects of cultural distance.

Keywords: Trade in services; Cultural distance; Gravity equation (search for similar items in EconPapers)
Date: 2020
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Related works:
Working Paper: Cultural Distance and International Trade in Services: A Disaggregate View (2017) Downloads
Working Paper: Cultural Distance and International Trade in Services: A Disaggregate View (2016) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecosys:v:44:y:2020:i:2:s0939362518302401

DOI: 10.1016/j.ecosys.2020.100786

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