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Immigrant’s Characteristics and its different effects on bilateral trade

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  • José Vicente Blanes-Cristóbal

    (Universidad Pablo de Olavide)

Abstract

This paper tests for the impact of immigration on bilateral trade using Spanish data from 1995 to 2003. It also explores some possible mechanisms through which the stock of immigrants in a country can contribute to its trade. It uses a gravity equation for trade augmented with an immigrants stock variable and a set of control variables. The immigrants variable enters the estimated equation in different ways depending on immigrant relevant characteristics. Results show that there is a positive link between immigration and both exports and imports. We find evidence for the trade transaction cost channel but not for the preference one. We find evidence that support that the mechanisms behind this link are the information effect - additional information about product and about social and political institutions brought by immigrants - and the social o ethnic network effect - since immigrants with a medium level of education and those who are related to business activities are the one who have a positive effect on bilateral trade.

Suggested Citation

  • José Vicente Blanes-Cristóbal, 2005. "Immigrant’s Characteristics and its different effects on bilateral trade," Working Papers 05-09, Asociación Española de Economía y Finanzas Internacionales.
    • Handle: RePEc:aee:wpaper:0509
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    References listed on IDEAS

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    1. Rauch, James E., 1999. "Networks versus markets in international trade," Journal of International Economics, Elsevier, vol. 48(1), pages 7-35, June.
    2. Sourafel Girma & Zhihao Yu, 2002. "The link between immigration and trade: Evidence from the United Kingdom," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 138(1), pages 115-130, March.
    3. Dunlevy, James A. & Hutchinson, William K., 1999. "The Impact of Immigration on American Import Trade in the Late Nineteenth and Early Twentieth Centuries," The Journal of Economic History, Cambridge University Press, vol. 59(4), pages 1043-1062, December.
    4. James E. Rauch, 2001. "Business and Social Networks in International Trade," Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1177-1203, December.
    5. Gould, David M, 1994. "Immigrant Links to the Home Country: Empirical Implications for U.S. Bilateral Trade Flows," The Review of Economics and Statistics, MIT Press, vol. 76(2), pages 302-316, May.
    6. Keith Head & John Ries, 1998. "Immigration and Trade Creation: Econometric Evidence from Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 31(1), pages 47-62, February.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Murat Genc & Masood Gheasi & Peter Nijkamp & Jacques Poot, 2012. "The impact of immigration on international trade: a meta-analysis," Chapters, in: Peter Nijkamp & Jacques Poot & Mediha Sahin (ed.), Migration Impact Assessment, chapter 9, pages 301-337, Edward Elgar Publishing.
    2. Lin, Xiaohua & Yang, Xiyan, 2017. "From human capital externality to entrepreneurial aspiration: Revisiting the migration-trade linkage," Journal of World Business, Elsevier, vol. 52(3), pages 360-371.
    3. Sara Flisi & Marina Murat, 2009. "Immigrant Links, Diasporas and FDI. An Empirical Investigation on Five European Countries," Department of Economics 0608, University of Modena and Reggio E., Faculty of Economics "Marco Biagi".
    4. Horácio Faustino & Isabel Proença, 2011. "Effects of Immigration on Intra-Industry Trade: A logit analysis," Working Papers Department of Economics 2011/19, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
    5. A. James Wynne & Chandrashekar Challa & John Palesis & Bernie Farkas, 2015. "A Conceptual Model: Impact Of Usage Of Social Media Tools To Enhance Project Management Success," Portuguese Journal of Management Studies, ISEG, Universidade de Lisboa, vol. 0(2), pages 55-72.
    6. Horácio C. Faustino & Isabel Proença, 2015. "Immigration And Intra-Industry Trade: The Relevance Of Language, Qualification And Economic Integration," Portuguese Journal of Management Studies, ISEG, Universidade de Lisboa, vol. 0(1), pages 3-18.
    7. Marina Murat & Barbara Pistoresi & Alberto Rinaldi, 2008. "Italian Diaspora and Foreign Direct Investment: A Cliometric Perspective," Center for Economic Research (RECent) 013, University of Modena and Reggio E., Dept. of Economics "Marco Biagi".
    8. José V. Blanes & Juliette Milgram Baleix, 2006. "The Free Trade Agreement Morocco-EU: a simulation of the impact on EU exports," ThE Papers 06/09, Department of Economic Theory and Economic History of the University of Granada..
    9. Yang, Xiyan & Lin, Xiaohua, 2022. "Overcoming informal barriers to trade: Immigrant educational attainment vs. network competence," International Business Review, Elsevier, vol. 31(1).

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    More about this item

    Keywords

    International Trade; Migration;

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration

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