Do Autocratic States Trade Less?
Aidt, Toke S.
Cambridge Working Papers in Economics
Faculty of Economics
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Aidt, T. S., & Gassebner, M. (2007). Do Autocratic States Trade Less?. https://doi.org/10.17863/CAM.5141
The paper analyzes whether the political regime of a country influences its involvement in international trade. Firstly, we develop a theoretical model that predicts that autocracies trade less than democracies. Secondly, we test the predictions of the model empirically using a panel of more than 130 countries for the years 1962 to 2000. In contrast to the existing literature, we use data on individual importing and exporting countries, rather than a dyadic set-up. In line with the model, we find that autocracies import substantially less than democracies, even after controlling for official trade policies. This finding is very stable and does not depend on a particular set-up or estimation technique.
international trade, democracy, autocracy, gravity model
This record's DOI: https://doi.org/10.17863/CAM.5141
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