Barriers%20to%20Exit

Working Papers

Barriers to Exit


CODE: WP-572
AUTHOR(s): Chong, Alberto , León, Gianmarco
PUBLISHED: August 2006
LANGUAGE: English
RELATED TOPICS: Trade
DOWNLOAD FILE IN: English

Abstract:

Unlike previous empirical studies that focus on barriers to entry in international trade, we focus on barriers to exit as measured by passport costs for a cross-section of countries. We test four common theories on the determinants of such exit barriers and find that macroeconomic and brain-drain explanations do explain high barriers to exit. However, institutional and cultural hypotheses do not appear to be empirically robust explanations of such high barriers. Our findings hold when applying instrumental variables, changes in specification, and changes in cross-country periods.

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