Export Competence of Cultural Goods: A Structural Gravity Analysis of the BRICS Trade

Abstract

The BRICS economies contribute a substantial portion of global trade. However, the share of cultural export in their total exports has been declining over the past two decades. In this context, the current study examines cultural exports of BRICS compared to their aggregate exports using structural gravity model. For empirical estimation, we apply Poisson Pseudo-Maximum Likelihood High Dimensional Fixed Effects (PPMLHDFE) estimator for annual bilateral exports data. The results show that, as compared to non-cultural aggregate exports, exports of creative industries are more sensitive to geographical distance between countries. Nevertheless, positive effect of the similarity between trading partners in terms of language commonality, colonial relationship and shared border is more pronounced in case of cultural exports. Furthermore, we find that while the regional trade agreements promote exports in general, they remain inconsequential in case of cultural exports of BRICS. Additionally, the study uses cultural exports as a proxy for cultural proximity and finds that bilateral cultural exports facilitate the exports of non-cultural exports.