Do Migrants Really Foster Trade? The Trade-Migration Nexus, a Panel Approach 1960-2000
Despite the burgeoning empirical literature providing evidence of a strong and robust positive correlation between trade and migration, doubts persist as to unobserved factors which may be driving this relationship. This paper re-examines the trade...
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| Format: | Policy Research Working Paper |
| Language: | English |
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World Bank, Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2012/04/16219447/migrants-really-foster-trade-trade-migration-nexus-panel-approach-1960-2000 http://hdl.handle.net/10986/6036 |
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okr-10986-60362021-04-23T14:02:24Z Do Migrants Really Foster Trade? The Trade-Migration Nexus, a Panel Approach 1960-2000 Parsons, Christopher R. AGGREGATE EXPORTS AGGREGATE TRADE ARBITRAGE BARRIER BARRIERS TO TRADE BENCHMARK BILATERAL TRADE CAUSE FOR CONCERN CHANGES IN TRADE COMMODITIES CONTRACTUAL ARRANGEMENTS COUNTRY FIXED EFFECTS COUNTRY OF ORIGIN CURRENCY CURRENCY UNION CURRENCY UNIONS CUSTOMS CUSTOMS PROCEDURES DEVELOPING COUNTRIES DEVELOPING NATIONS DEVELOPMENT POLICY DISTRIBUTION COSTS ECONOMIC DEVELOPMENT ECONOMIC HISTORY ECONOMIC IMPLICATIONS ECONOMIC INTEGRATION ECONOMIC POLICIES ECONOMIC POLICY ECONOMIC RESEARCH ELASTICITY EXPORT MARKET EXPORTERS EXPORTING COUNTRY EXPORTS FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL CONSTRAINTS FOREIGN TRADE FREE TRADE FREE TRADE AGREEMENTS GDP GEOGRAPHIC PROXIMITY GLOBALIZATION GRAVITY FRAMEWORK GRAVITY MODEL GRAVITY MODELS GRAVITY VARIABLES HOME COUNTRY HUMAN CAPITAL IMPORTING COUNTRY IMPORTS INSURANCE INTERNATIONAL BANK INTERNATIONAL ECONOMICS INTERNATIONAL LABOR MOBILITY INTERNATIONAL TRADE INVENTORY LEGAL SYSTEM MULTILATERAL TRADE NATIONAL INCOME NOMINAL VALUE NON-TARIFF BARRIERS PERFECT COMPETITION POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECTS POTENTIAL BENEFITS PREFERENCE EFFECTS PRICE INDEX PRODUCT DIFFERENTIATION REGIONAL TRADE REGIONAL TRADE AGREEMENTS SUFFICIENT EVIDENCE TARIFF BARRIERS TERMS OF TRADE TRADE AGREEMENT TRADE AGREEMENTS TRADE BARRIERS TRADE COSTS TRADE CREATING TRADE CREATION TRADE DATA TRADE DIVERSION TRADE EFFECTS TRADE FACILITATION TRADE FLOWS TRADE RESTRICTIONS TRANSACTION COST TRANSACTION COSTS TRANSPORT COSTS TREASURY UTILITY FUNCTION VALUE OF EXPORTS WELFARE GAINS WORLD TRADE WTO Despite the burgeoning empirical literature providing evidence of a strong and robust positive correlation between trade and migration, doubts persist as to unobserved factors which may be driving this relationship. This paper re-examines the trade-migration nexus using a panel spanning several decades, which comprises the majority of world trade and migration in every decade. First the findings common to the literature are reproduced. Country-pair fixed effects are then used to account for unobserved bilateral factors, the implementation of which removes all of the positive impact of migration on trade. In other words the unobserved factors, a leading candidate for which it is argued is international bilateral ties, are on average strongly and positively correlated with migrant networks. Dividing the world into the relatively affluent North and poorer South, the results show that migrants from either region only affect Northern exports to the South. This is intuitive since in general countries of the North export more differentiated products and information barriers between these regions are greatest. A country-level analysis further shows that migrants may both create and divert trade. Taken as a whole, the results demonstrate the large biases inherent in cross-sectional studies investigating the trade-migration nexus and highlight the extent to which previous results have been overstated. 2012-04-27T07:44:12Z 2012-04-27T07:44:12Z 2012-04 http://documents.worldbank.org/curated/en/2012/04/16219447/migrants-really-foster-trade-trade-migration-nexus-panel-approach-1960-2000 http://hdl.handle.net/10986/6036 English Policy Research Working Paper ; No. 6034 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
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Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
AGGREGATE EXPORTS AGGREGATE TRADE ARBITRAGE BARRIER BARRIERS TO TRADE BENCHMARK BILATERAL TRADE CAUSE FOR CONCERN CHANGES IN TRADE COMMODITIES CONTRACTUAL ARRANGEMENTS COUNTRY FIXED EFFECTS COUNTRY OF ORIGIN CURRENCY CURRENCY UNION CURRENCY UNIONS CUSTOMS CUSTOMS PROCEDURES DEVELOPING COUNTRIES DEVELOPING NATIONS DEVELOPMENT POLICY DISTRIBUTION COSTS ECONOMIC DEVELOPMENT ECONOMIC HISTORY ECONOMIC IMPLICATIONS ECONOMIC INTEGRATION ECONOMIC POLICIES ECONOMIC POLICY ECONOMIC RESEARCH ELASTICITY EXPORT MARKET EXPORTERS EXPORTING COUNTRY EXPORTS FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL CONSTRAINTS FOREIGN TRADE FREE TRADE FREE TRADE AGREEMENTS GDP GEOGRAPHIC PROXIMITY GLOBALIZATION GRAVITY FRAMEWORK GRAVITY MODEL GRAVITY MODELS GRAVITY VARIABLES HOME COUNTRY HUMAN CAPITAL IMPORTING COUNTRY IMPORTS INSURANCE INTERNATIONAL BANK INTERNATIONAL ECONOMICS INTERNATIONAL LABOR MOBILITY INTERNATIONAL TRADE INVENTORY LEGAL SYSTEM MULTILATERAL TRADE NATIONAL INCOME NOMINAL VALUE NON-TARIFF BARRIERS PERFECT COMPETITION POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECTS POTENTIAL BENEFITS PREFERENCE EFFECTS PRICE INDEX PRODUCT DIFFERENTIATION REGIONAL TRADE REGIONAL TRADE AGREEMENTS SUFFICIENT EVIDENCE TARIFF BARRIERS TERMS OF TRADE TRADE AGREEMENT TRADE AGREEMENTS TRADE BARRIERS TRADE COSTS TRADE CREATING TRADE CREATION TRADE DATA TRADE DIVERSION TRADE EFFECTS TRADE FACILITATION TRADE FLOWS TRADE RESTRICTIONS TRANSACTION COST TRANSACTION COSTS TRANSPORT COSTS TREASURY UTILITY FUNCTION VALUE OF EXPORTS WELFARE GAINS WORLD TRADE WTO |
| spellingShingle |
AGGREGATE EXPORTS AGGREGATE TRADE ARBITRAGE BARRIER BARRIERS TO TRADE BENCHMARK BILATERAL TRADE CAUSE FOR CONCERN CHANGES IN TRADE COMMODITIES CONTRACTUAL ARRANGEMENTS COUNTRY FIXED EFFECTS COUNTRY OF ORIGIN CURRENCY CURRENCY UNION CURRENCY UNIONS CUSTOMS CUSTOMS PROCEDURES DEVELOPING COUNTRIES DEVELOPING NATIONS DEVELOPMENT POLICY DISTRIBUTION COSTS ECONOMIC DEVELOPMENT ECONOMIC HISTORY ECONOMIC IMPLICATIONS ECONOMIC INTEGRATION ECONOMIC POLICIES ECONOMIC POLICY ECONOMIC RESEARCH ELASTICITY EXPORT MARKET EXPORTERS EXPORTING COUNTRY EXPORTS FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL CONSTRAINTS FOREIGN TRADE FREE TRADE FREE TRADE AGREEMENTS GDP GEOGRAPHIC PROXIMITY GLOBALIZATION GRAVITY FRAMEWORK GRAVITY MODEL GRAVITY MODELS GRAVITY VARIABLES HOME COUNTRY HUMAN CAPITAL IMPORTING COUNTRY IMPORTS INSURANCE INTERNATIONAL BANK INTERNATIONAL ECONOMICS INTERNATIONAL LABOR MOBILITY INTERNATIONAL TRADE INVENTORY LEGAL SYSTEM MULTILATERAL TRADE NATIONAL INCOME NOMINAL VALUE NON-TARIFF BARRIERS PERFECT COMPETITION POLICY RESEARCH POLITICAL ECONOMY POSITIVE EFFECTS POTENTIAL BENEFITS PREFERENCE EFFECTS PRICE INDEX PRODUCT DIFFERENTIATION REGIONAL TRADE REGIONAL TRADE AGREEMENTS SUFFICIENT EVIDENCE TARIFF BARRIERS TERMS OF TRADE TRADE AGREEMENT TRADE AGREEMENTS TRADE BARRIERS TRADE COSTS TRADE CREATING TRADE CREATION TRADE DATA TRADE DIVERSION TRADE EFFECTS TRADE FACILITATION TRADE FLOWS TRADE RESTRICTIONS TRANSACTION COST TRANSACTION COSTS TRANSPORT COSTS TREASURY UTILITY FUNCTION VALUE OF EXPORTS WELFARE GAINS WORLD TRADE WTO Parsons, Christopher R. Do Migrants Really Foster Trade? The Trade-Migration Nexus, a Panel Approach 1960-2000 |
| relation |
Policy Research Working Paper ; No. 6034 |
| description |
Despite the burgeoning empirical
literature providing evidence of a strong and robust
positive correlation between trade and migration, doubts
persist as to unobserved factors which may be driving this
relationship. This paper re-examines the trade-migration
nexus using a panel spanning several decades, which
comprises the majority of world trade and migration in every
decade. First the findings common to the literature are
reproduced. Country-pair fixed effects are then used to
account for unobserved bilateral factors, the implementation
of which removes all of the positive impact of migration on
trade. In other words the unobserved factors, a leading
candidate for which it is argued is international bilateral
ties, are on average strongly and positively correlated with
migrant networks. Dividing the world into the relatively
affluent North and poorer South, the results show that
migrants from either region only affect Northern exports to
the South. This is intuitive since in general countries of
the North export more differentiated products and
information barriers between these regions are greatest. A
country-level analysis further shows that migrants may both
create and divert trade. Taken as a whole, the results
demonstrate the large biases inherent in cross-sectional
studies investigating the trade-migration nexus and
highlight the extent to which previous results have been overstated. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Parsons, Christopher R. |
| author_facet |
Parsons, Christopher R. |
| author_sort |
Parsons, Christopher R. |
| title |
Do Migrants Really Foster Trade?
The Trade-Migration Nexus, a Panel Approach 1960-2000 |
| title_short |
Do Migrants Really Foster Trade?
The Trade-Migration Nexus, a Panel Approach 1960-2000 |
| title_full |
Do Migrants Really Foster Trade?
The Trade-Migration Nexus, a Panel Approach 1960-2000 |
| title_fullStr |
Do Migrants Really Foster Trade?
The Trade-Migration Nexus, a Panel Approach 1960-2000 |
| title_full_unstemmed |
Do Migrants Really Foster Trade?
The Trade-Migration Nexus, a Panel Approach 1960-2000 |
| title_sort |
do migrants really foster trade?
the trade-migration nexus, a panel approach 1960-2000 |
| publisher |
World Bank, Washington, DC |
| publishDate |
2012 |
| url |
http://documents.worldbank.org/curated/en/2012/04/16219447/migrants-really-foster-trade-trade-migration-nexus-panel-approach-1960-2000 http://hdl.handle.net/10986/6036 |
| _version_ |
1764397188452974592 |