at 10:00

Export costs of visa restrictions: evidence from Russia
Natalia Kapelko and Natalya Volchkova
New Economic School, CEFIR, Moscow
The paper studies the role visa restrictions play in determining export flows between Russian firms and their partners and explores the mechanism of this relationship. The specification of empirical model is derived from a heterogeneous firms’ model of trade. The existing visa restrictions are used as proxies for the costs the exporters incur while dealing with customers abroad. The results indicate that visas have a negative market access effect. Controlling for the choice of destination, visas have a significant negative effect on the value of relationship-specific exports. These results are consistent with informational and contractual nature of visa costs.