Despite the rapid growth of world trade over the past several decades, international trade patterns remain very much affected by high trade costs. In this paper, we emphasize the importance of distance between countries in a proper explanation of the persistent resistance to trade. We find that both formal trade barriers (tariffs, transport costs, etc.) and informal trade barriers (related to cultural and institutional distances) between countries have retained their importance to trade. Not only are these tangible and intangible barriers critical in explaining the volume of trade between countries but they also help to explain the absence of trade between many countries.

Distance, International trade, Trade barriers
dx.doi.org/10.1093/cjres/rsn019, hdl.handle.net/1765/61461
Cambridge journal of regions, economy and society
Erasmus Research Institute of Management

Linders, G.J.M, Burger, M.J, & van Oort, F.G. (2008). A rather empty world: The many faces of distance and the persistent resistance to international trade. Cambridge journal of regions, economy and society, 1(3), 439–458. doi:10.1093/cjres/rsn019