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National borders matter … where one draws the lines too

Author

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  • Emmanuelle Lavallée
  • Vincent Vicard
Abstract
The fact that crossing a political border dramatically reduces trade flows has been widely documented in the literature. The increasing number of borders has surprisingly attracted much less attention. The number of independent countries has indeed risen from 72 in 1948 to 192 today. This paper estimates the effect of political disintegration since World War II on the measured growth in world trade. We first show that trade statistics should be considered carefully when assessing globalization over time, since the definition of trade partners varies over time. We document a sizeable resulting accounting artefact, which accounts for 17% of world trade in 2007. Second, based on a structural gravity equation, we estimate that since World War II political disintegration alone has raised measured international trade flows by 7% but decreased actual trade flows (including inter‐regional trade) by 2%. Le fait qu’une frontière politique réduise dramatiquement les flux de commerce a été amplement documenté dans la littérature. Le nombre croissant de frontières a, de façon surprenante, attiré moins l’attention. Le nombre de pays indépendants est passé de 72 en 1948 à 192 aujourd’hui. Cet article évalue l’effet de cette désintégration politique depuis la Seconde Guerre Mondiale sur la croissance mesurée du commerce mondial. On montre d’abord que les statistiques de commerce doivent être utilisées avec précaution quand on veut évaluer le degré de mondialisation dans le temps car la définition des partenaires commerciaux change dans le temps. Nous montrons que l'artifice comptable qui en résulte est important, et représente 17% du commerce mondial en 2007. Ensuite, à partir d’une équation structurelle de gravité, nous évaluons que, depuis la Seconde Guerre Mondiale, la désintégration politique a, à elle seule, accru les flux mesurés de commerce international de 7% mais a réduit les flux réels de commerce (y compris le commerce interrégional) de 2%.

Suggested Citation

  • Emmanuelle Lavallée & Vincent Vicard, 2013. "National borders matter … where one draws the lines too," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 46(1), pages 135-153, February.
    • Handle: RePEc:wly:canjec:v:46:y:2013:i:1:p:135-153
    DOI: 10.1111/caje.12008
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    References listed on IDEAS

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    1. Hinnerk Gnutzmann & Arevik Gnutzmann‐Mkrtchyan, 2019. "The silent success of customs unions," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 52(1), pages 178-224, February.

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