Anatomy of a Health Scare: Education, Income and the MMR

Wednesday February 18, 2009, 15:00
Extranef, Dorigny, room 109

Matthias THÖNIG
(Université de Genève)

Product-Based Cultural Change: Is the Village Global?

Abstract

This paper makes three contributions to the growing literature on culture and economics. First, we build a direct measure of cultural distance

across countries based on answers to the World Values Survey. We show that bilateral cultural distances exhibit significant time variation:

the standard deviation of changes in cultural distances over a 10 year period is almost equal to one third of the cross-sectional standard deviation.

Second, using insights from other branches of social sciences, we build a model that ties culture to consumption. Two main implications of

the model are that bilateral trade reduces bilateral cultural distance and that the effect is strongest for more differentiated products. Third,

we test the model using a panel of 49 countries over the 1980-2004 period. Using an instrumental variable approach and including various

time and country-pair fixed effects, we find that a one standard deviation increase in bilateral trade openness translates into a 36.2%  standard

deviation decrease in bilateral cultural distance.

Web site of the seminar (with paper online): http://www.hec.unil.ch/deep/evenements-english/e-sem-all-2008-09.htm