The Influence Of Cultural Differences On China's Foreign Trade

China's foreign trade growth has been faster than the growth rate of gross domestic product(GDP),and it has played an important role in growth of China's economic miracle.Moreover,the world economic integration process is relatively quickly and when there are economic and trade exchanges between countries,special cultural background and special cultural environment of different countries and different ethnic groups has drawn various countries' attention.The influence of cultural differences has become more and more important.The cultural differences in global trade has profoundly affected the trade contacts and activities between countries.As a consequence,studying the influence of cultural differences on China's foreign trade has important practical significance.In this paper,I use the Schwartz culture score data of nation collected in 2000 and 2008,to establish a new method of measuring of cultural differences between countries.As a control variable,it expands the gravity model to test cultural differences' marginal effect on import and export trade between China and 49 other countries whose Schwartz culture score can be obtained.In addition to the cultural distance and economic factors such as GDP,other control variables such as distances?religion?language commonalities and immigration are included in the Gravity model.The results show that after controlling for the other variables,the effects of language commonality on import trade and export trade are found to be positive.And the effect of culture on import trade is found to be insignificant while on export trade is found to be positive.The findings of this study entail that managers should not stay away from culturally dissimilar partners as long as trade is economically beneficial.Sometimes cultural dissimilarity may be an indication of good potential for international trade,especially for export trade.