Trade in services’ resilience to crisis: the role of institutions

Mardi | 2015-04-07
Sully 5, 16h-17h20

Isabelle RABAUD

Services represent nearly 70% of employment and generate more than two thirds of employment, while trade in services accounts for only 20% of total trade. World exports of services appear more resilient to recent crisis than trade in goods. Impediments to trade in services correspond mainly to regulations. This paper aims to look at the impact of the quality of institution on the intensity of bilateral trade in services. We apply a gravity equation in panel of 186 countries, from 2002 to 2010. The intensity of trade in services between partner countries increases with GDP, contiguity and colonial links and falls with distance. In accordance with our intuition, institutions of the destination country matter.