Replication data for: Freedom Fries

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AEJApp-2009-0180-stata			10/12/2019 03:11:PM
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Project Citation:

Michaels, Guy, and Zhi, Xiaojia. Replication data for: Freedom Fries. Nashville, TN: American Economic Association [publisher], 2010. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-10-12. https://doi.org/10.3886/E113758V1

Project Description

Summary: Do firms always choose the cheapest suitable inputs, or can group attitudes affect their choices? To investigate this question, we examine the deterioration of relations between the United States and France from 2002-2003, when France's favorability rating in the US fell by 48 percentage points. We estimate that the worsening attitudes reduced bilateral trade by about 9 percent and that trade in inputs probably declined similarly, by about 8 percent. We use these estimates to calculate the average decrease in firms' willingness to pay for French (or US) commodities when attitudes worsened. (JEL D24, F13, F14, L14, L21)

Scope of Project

JEL Classification:
      D24 Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
      F13 Trade Policy; International Trade Organizations
      F14 Empirical Studies of Trade
      L14 Transactional Relationships; Contracts and Reputation; Networks
      L21 Business Objectives of the Firm

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Published Versions

V1 [2019-10-12]

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