Countries’ Image and Agricultural Trade Volume

Abstract

AbstractThe main focus of this paper is to demonstrate empirically that country of origin perceptions have an impact on actual agricultural trade volume. Moreover, a second aim is to compare these effects on agricultural trade volume with effects on the non-agricultural sectors (manufacture, machinery and transportation equipment as well as the chemicals sector). The study empirically tests these relationships using a bilateral measure of reputation as a determinant of export volume, utilizing one of the most successful models in the literature of international economics, the structural gravity model of international trade. Countries’ reputation measures are derived from a global survey, in which respondents in 20 countries rate the reputation for products and people of 50 other countries. As the results indicate, a better country reputation for products and people is associated with increased agricultural trade volume. It is worth noting that the effects of a country’s image concerning its products are minor in the agricultural sector in comparison with the three other investigated sectors.KeywordsGravity equation modelInternational tradeReputation