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Title:How much does violence tax trade? PDF Logo
Authors:Blomberg, S. Brock
Hess, Gregory D.
Issue Date:2004
Series/Report no.:CESifo working papers 1222
Abstract:We investigate the empirical impact of violence as compared to other trade impediments on trade flows. Our analysis is based on a panel data set with annual observations on 177 countries from 1968 to 1999, which brings together information from the Rose [2004] dataset, the ITERATE dataset for terrorist events, and datasets of external and internal conflict. We explore these data with traditional and theoretical gravity models. We calculate that, for a given country year, the presence of terrorism, as well as internal and external conflict is equivalent to as much as a 30 percent tariff on trade. This is larger than estimated tariffequivalent costs of border and language barriers and tariff-equivalent reduction through GSPs and WTO participation.
Subjects:trade
conflict
terrosism
JEL:D74
E6
H5
H1
O11
Document Type:Working Paper
Appears in Collections:CESifo Working Papers, CESifo Group Munich

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