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The Diplomacy of Trade: An Empirical Investigation of State Visits as a Tool for Export Promotion and the Specific Role of the Head of State

Lundqvist, Ebba LU and Wieslander, Clara LU (2023) NEKP01 20231
Department of Economics
Abstract
This paper evaluates the impact of state visits on export flows and the specific role of the head of state based on the five Nordic countries: Denmark, Finland, Iceland, Norway, and Sweden. We construct a complete and comprehensive dataset containing all outgoing state visits from the Nordic countries between 1973 and 2022. Our main empirical strategy is to apply a difference-in differences (DiD) approach using a novel robust estimation method by Callaway and Sant’Anna (2021) to estimate the effect of state visits on export flows and the role that the head of state plays during state visits. We also employ a traditional two-way fixed effects (TWFE) DiD approach to compare the results. Furthermore, we employ a series of placebo tests and... (More)
This paper evaluates the impact of state visits on export flows and the specific role of the head of state based on the five Nordic countries: Denmark, Finland, Iceland, Norway, and Sweden. We construct a complete and comprehensive dataset containing all outgoing state visits from the Nordic countries between 1973 and 2022. Our main empirical strategy is to apply a difference-in differences (DiD) approach using a novel robust estimation method by Callaway and Sant’Anna (2021) to estimate the effect of state visits on export flows and the role that the head of state plays during state visits. We also employ a traditional two-way fixed effects (TWFE) DiD approach to compare the results. Furthermore, we employ a series of placebo tests and robustness checks to validate our results. Our analysis reveals that outgoing state visits made by the Nordic countries have a significant impact on export flows with an average post-treatment effect of 276.8 million USD. The role of the head of state is
less pronounced, although our results indicate that state visits conducted by monarchs drive the results more than state visits performed by presidents. (Less)
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author
Lundqvist, Ebba LU and Wieslander, Clara LU
supervisor
organization
course
NEKP01 20231
year
type
H2 - Master's Degree (Two Years)
subject
keywords
State Visits, Export Promotion, Head of State, Monarchy, Republic, Difference-in-Differences
language
English
id
9118674
date added to LUP
2023-06-19 10:08:25
date last changed
2023-06-19 10:08:25
@misc{9118674,
  abstract     = {{This paper evaluates the impact of state visits on export flows and the specific role of the head of state based on the five Nordic countries: Denmark, Finland, Iceland, Norway, and Sweden. We construct a complete and comprehensive dataset containing all outgoing state visits from the Nordic countries between 1973 and 2022. Our main empirical strategy is to apply a difference-in differences (DiD) approach using a novel robust estimation method by Callaway and Sant’Anna (2021) to estimate the effect of state visits on export flows and the role that the head of state plays during state visits. We also employ a traditional two-way fixed effects (TWFE) DiD approach to compare the results. Furthermore, we employ a series of placebo tests and robustness checks to validate our results. Our analysis reveals that outgoing state visits made by the Nordic countries have a significant impact on export flows with an average post-treatment effect of 276.8 million USD. The role of the head of state is
less pronounced, although our results indicate that state visits conducted by monarchs drive the results more than state visits performed by presidents.}},
  author       = {{Lundqvist, Ebba and Wieslander, Clara}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{The Diplomacy of Trade: An Empirical Investigation of State Visits as a Tool for Export Promotion and the Specific Role of the Head of State}},
  year         = {{2023}},
}