The impact of economic diplomacy on exports: The Portuguese case

Abstract

It is widely recognized that exports contribute to economic growth. Many governments have seen economic diplomacy representation (foreign offices, embassies and consulates) as an important tool to diminish export barriers and foster economic growth. Thus, this study aims at understanding to what extent does the presence of Portuguese economic diplomatic representation in foreign states impact Portuguese exports. Based on merchandise exports to 144 countries for the period between 2008 and 2018, and using a quasi-gravity model of trade, results indicate that ceteris paribus, Portugal exports more to countries which host a Portuguese office and an increase in the number of offices in a foreign country positively affects exports to that country.