Social interactions of migrants and trade outcomes

Abstract

This paper investigates the impact of social interactions with immigrants on bilateral trade in French regions. Applying data on the distribution of immigrants in 95 French counties ("départment" in French) during 5 years, a measure of formation of networks is proposed and its impact is tested on international trade, providing a direct measure of the impact of social interactions on the economy. Direct comparisons confirm this measure as more complete and robust than measures used in international trade literature.