Working Paper: NBER ID: w21537
Authors: Andrew K. Rose
Abstract: In this paper I quantify a gain that a country receives when its global influence is considered to be admirable by others. I use a standard gravity model of bilateral exports, a panel of data from 2006 through 2013, and an annual survey conducted for the BBC by GlobeScan which asks people in up to 46 countries about whether each of up to 17 countries were perceived to have “a mainly positive or negative influence in the world.” Holding other things constant, a country’s exports are higher if it is perceived by the importer to be exerting more positive global influence. This effect is statistically and economically significant; a one percent net increase in perceived positive influence raises exports by around .8 percent. Succinctly, countries receive a commercial return on their soft power.
Keywords: Soft Power; Exports; International Trade; Gravity Model
JEL Codes: F14; F59
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| perceived positive influence (D91) | exports (F10) |
| negative perceptions (D91) | exports (F10) |