Economic preferences and trade outcomes

Abstract Integrating the Global Preference Survey (GPS) and its data of unique scope on national preference structures in patience, risk attitude reciprocity into a gravity framework, this paper is first to explore potential influence international trade outcomes economic social preferences unified setting. Adding evidence preferences’ importance for aggregate outcomes, authors find marked differences flows relationships, both country-level between bilateral partners. Their main results suggest that countries differing their willingness behave negatively reciprocal tend significantly less amongst each other due destabilizing effect unexpected punishments. On hand, are patient or risk-averse shift towards exporting more differentiated goods as opposed homogeneous vice versa. We propose term transformation considerations driving mechanisms relationship.