Jacks, David S. (David Steven), Meissner, Christopher M. (Christopher Michael) and Novy, Dennis (2007) Trade costs in the first wave of Globalization. Working Paper. Cambridge, Massachusetts: National Bureau of Economic Research. (Working paper series (National Bureau of Economic Research).

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Abstract

What drives globalization today and in the past? We employ a new micro-founded measure of bilateral trade costs based on a standard model of trade in differentiated goods to address this question. These trade costs gauge the difference between observed bilateral trade and frictionless trade. They comprise tariffs, transportation costs and all other factors that impede international trade but which are inherently difficult to observe. Trade costs fell on average by ten to Þfteen percent between 1870 and 1913. We also use this measure to decompose the growth of global trade over that period and Þnd that roughly 44 percent of the global trade boom can be explained by reductions in trade costs; the remaining 56 percent is attributable to economic expansion.

Item Type:	Working or Discussion Paper (Working Paper)
Subjects:	H Social Sciences > HF Commerce
Divisions:	Faculty of Social Sciences > Economics
Library of Congress Subject Headings (LCSH):	Globalization -- Economic aspects, International trade -- Research, International trade -- Econometric models, International economic relations -- History -- 19th century, International economic relations -- History -- 20th century
Series Name:	Working paper series (National Bureau of Economic Research)
Publisher:	National Bureau of Economic Research
Place of Publication:	Cambridge, Massachusetts
Date:	8 August 2007
Number:	No.12602
Number of Pages:	34
Status:	Not Peer Reviewed
Access rights to Published version:	Open Access
Description:	Working paper issued October 2006; revised 8 August 2007.
Funder:	Social Sciences and Humanities Research Council of Canada (SSHRC)
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URI:	http://wrap.warwick.ac.uk/id/eprint/3377

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