The weight of economic and commercial diplomacy

This paper investigates the impact of economic and commercial diplomacy on the geography of international trade. We replicate a recent study by Rose (2007) extending the analysis to include the year 2006 and 63 importing and exporting countries. Using a gravity model we are able to demonstrate that diplomatic representation via embassies and consulates is not a relevant trade enhancing factor for trade within the OECD. In contrast diplomatic representation is significant in bilateral trade relationships of developing countries as it both facilitates imports and stimulates exports. We discuss some implications of our findings for developing countries especially in view of South–South trade

Economic diplomacy, trade and developing countries

This article analyses the impact of economic diplomacy on the geography of international trade for the year 2006 and 63 importing and exporting countries. We demonstrate that diplomatic representation via embassies and consulates is not a relevant trade-enhancing factor for trade within the OECD, but that it is significant in bilateral trade relationships of developing countries. We discuss implications for developing countries especially in view of South-South trade