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International trade patterns, trade potentials, national institutions and cross-border networks

Abstract : This dissertation studies the burden of international trade costs on trade between countries, and the contribution of two non-traditional factors to lowering these costs. It evaluates the size of overall border-related trade costs, and the extent to which their reduction can be achieved via regional economic integration. A central place in this discussion is attributed to non-traditional trade determinants, represented by country-specific institutions, and by transnational social and business networks. The latter furnish foreign contacts and information about potential partners and increase the security and contract enforcement in international transactions, which all translate in lower costs and reduced uncertainty of cross-border exchanges. This study is important not only for a more thorough understanding of a series of phenomena observed in international economics, but also for the development of specific economic policies assisting countries in achieving their long term objectives.
The work presented in this thesis consists mainly of an empirical analysis of the above mentioned issues. But it also takes advantage of the recent theoretical advances in international trade literature. This thesis shows that there is room for non-traditional trade costs in explaining missing international trade. Trade potentials may actually have been underestimated in the literature, and trade creation associated with regional economic integration might be much larger than expected. This finding is illustrated in the particular case of trade between East and West European countries. Results presented in different chapters confirm the pro-trade effect of both institutions and transnational networks. The well-functioning of domestic and foreign institutions is a factor comparable in importance to foreign trade policies. Even after all tariff and non-tariff barriers are removed, institutional reforms can generate a large increase in international trade. Social networks promote trade not only via common ethnic, linguistic and other ties that connect their members, but also via information and tastes acquired from the consumption of foreign cultural goods. A particular form of business networks, home country associations established by immigrants in their host country, is studied in the last part of the dissertation. Migrant associations have a stronger effect on trade than social network ties, they shape foreign trade and affect decisions to invest abroad.
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Contributor : Angela Cheptea <>
Submitted on : Monday, November 12, 2007 - 3:42:01 PM
Last modification on : Saturday, June 6, 2020 - 4:49:08 PM
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  • HAL Id : tel-00186822, version 1
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Angela Cheptea. International trade patterns, trade potentials, national institutions and cross-border networks. Economics and Finance. Université Panthéon-Sorbonne - Paris I, 2005. English. ⟨tel-00186822⟩



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