NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

The Incidence of Geography on Canada's Services Trade

James E. Anderson, Catherine A. Milot, Yoto V. Yotov

NBER Working Paper No. 17630
Issued in December 2011
NBER Program(s):   ITI

We estimate geographic barriers to export trade in nine service categories for Canada's provinces from 1997 to 2007 using the structural gravity model. Constructed Home, Domestic and Foreign Bias indexes (the last two new) capture the direct plus indirect effect of services trade costs on intra-provincial, inter-provincial and international trade relative to their frictionless benchmarks. Barriers to services international trade are huge relative to inter-provincial trade and large relative to goods international trade. A novel test confirms the fit of structural gravity with services trade data.

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Document Object Identifier (DOI): 10.3386/w17630

How Much Does Geography Deflect Services Trade? Canadian Answers James E. Anderson Catherine A. Milot Yoto V. Yotov Boston College and NBER DFAIT Drexel University International Economic Review, forthcoming

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