Hofstede national culture and international trade

The objective is to analyse if international trade is affected by different national cultures. International trade of 21 World Bank listed countries is estimated as function of the Hofstede cultural dimensions, gross domestic product and population. First, we estimate the combined Hofstede culture dimensions and find significant positive effects on countries' international trade. Secondly, we decompose the Hofstede culture dimensions and estimate the effects of each separate dimension on international trade, finding only the MAS dimension to significantly affect international trade. We estimate additional equation versions to account for occasional trade restrictions with no international trade, as well as estimating how international trade varies between years. These additional estimations further support our original findings, and therefore act as robustness check.