Financial intermediation, trade agreements and international trade*
Language
EN
Article de revue
This item was published in
World Economy. 2021-03, vol. 44, n° 3, p. 788-817
English Abstract
Using a gravity model on a data set of 69 developed and developing countries over the period 1986–2006, we show that the trade-promoting role of financial intermediation in the exporting country is mitigated when this ...Read more >
Using a gravity model on a data set of 69 developed and developing countries over the period 1986–2006, we show that the trade-promoting role of financial intermediation in the exporting country is mitigated when this country faces low exporting costs, that is when there is a regional trade agreement (RTA) between this country and the importing one. We also establish that this mitigating effect is reduced in financially constrained sectors, for which the role of financial intermediation remains crucial. Finally, we find evidence that the same trade-boosting effect and the same interaction with RTAs prevail for financial intermediation in the importing country. © 2020 John Wiley & Sons LtdRead less <
English Keywords
Developing World
Economic History
Finance
International Trade
Regional Trade
Trade Agreement