Cultural and geographical distance: effects on UK exports

ABSTRACT

This research focuses on how cultural and geographical distance affect trade. The question is whether UK exports are similarly affected by Hofstede national culture distance and geographical distance. OECD data is applied to the United Kingdom’s exports as well as Hofstede cultural distance. The research also accounts for the trading countries’ economic size, as well as their market size, in order to account for economies of scale. Results indicate that exports are more impacted by geographical distance than the cultural distance between the UK and its main trading partners.

KEYWORDS:

• Exports
• Hofstede national culture
• trade
• UK
• gravity model

JEL CLASSIFICATION:

• F10
• F14
• F23
• M14
• M20

View correction statement:

Correction

Disclosure statement

No potential conflict of interest was reported by the author.

Notes

¹ Where it holds that: HOFSTEDEi = Pow_dis+ind+Mas+Uncer+Ori. Pow_dis = (pow_dis/104)*100. Mas = (mas/110)*100. Uncer = (uncer/112)*100. Ori = (ori/118)*100.weighted average Hofstede value for the UK minus the same value for other trading countries.