Birds of a Feather Trade Together: How International Social Connectedness Shapes Trade in Creative Goods

Abstract

This paper asks whether international social connectedness helps explain which countries trade creative goods with each other, beyond what geography alone can account for. Using bilateral trade data from UNCTAD, the Facebook-based Social Connectedness Index, and standard gravity controls, I find that more socially connected country pairs trade significantly more creative goods and that accounting for social ties cuts the estimated effect of geographic distance roughly in half. This suggests that standard trade models have been misreading social and informational barriers as strictly physical ones. The findings are consistent with the intuition that creative goods like film, music, design, and publishing depend especially on shared tastes, cultural familiarity, and awareness of foreign products, all of which travel through social networks. The results hold across a range of specifications and control variables. For policymakers, the results are consistent with the interpretation that programs building cross-border social ties — such as diaspora engagement, exchange programs, and open digital platforms — may do more to expand creative exports than traditional trade agreements, though establishing causality remains an important direction for future work.