Out of Sight, Not Out of Mind. Education Networks and International Trade

SummaryUniversity students typically develop between them long-lasting ties of friendship and trust, as well as an attachment to their university. If they are foreign students, they also form a bond to their country of study. This paper investigates the impact of university ties on the UK’s trade with 167 countries during 1999–2009. I find robust evidence that education network ties boost the UK’s bilateral trade flows. Specifically, the impact of networks is stronger on trade between the United Kingdom and countries with dissimilar institutions and culture, and particularly with post-communist economies. Results are robust to different econometric specifications and regressors.