logoRITM_longFor this week’s RITM seminar, we are hosting Marcelo Olarreaga (University of Geneva). He will be presenting “There goes gravity: eBay and the death of distance“.
The RITM seminar will be on Thursday, April 14, in Gaudemet room, from 2 to 3.30 pm.
We compare the effect of geographic distance on eBay and total international trade flows. We consider the same 61 countries and basket of goods for both types of transactions. We find the effect of distance to be on average 65% smaller on eBay. We argue this difference is due to a reduction in search costs; it increases with product differentiation and is higher when trade partners speak different languages, when corruption in the exporting country is high and when uncertainty avoidance is high in the importing country. Moreover, eBay’s seller-rating technology further reduces the distance effect on eBay.
The program of the RITM Seminar is here.