Christian Missionaries and Foreign Trade, 1580-1936

Abstract

We examine how Christian missions affected foreign trade expansion. As pioneers of Europeans’ global exploration since 1500, the missionaries provided useful information concerning the trade potential of remote areas to the Western audience. This mitigated the information asymmetry and entry cost of the early foreign trade. We test this hypothesis in the context of historical China, which had been preached by European missionaries from 1580 but was not opened to foreign trade until 1842. We find that prefectures which Christian missions had entered earlier were more likely to be introduced to the foreign market and thus to conduct foreign trade after 1842. The finding implies the importance of information flow in shaping the early global trade.