Do Ambassadors Matter? The effect of ambassadors over trade promotion

Determining whether diplomacy has a real impact on local producers has been a focus of the economic literature for the past 20 years, mainly because of its potential effects on information barriers. Using a natural experiment, this paper attempts to quantify the impact of ambassadors on countries’ trade promotion. Consistent with the previous literature, I find that ambassadors have a significant effect on the extensive margin, while the results are less significant on the intensive margin.