Abstract: Cultural differences between countries affect service trade greatly. Based on the Inglehart′s Culture Dimension Theory and adopting the WTI cultural barrier measurement, this study measures the degree of cultural barrier of China with sixteen trade partners and the impact of cultural barrier on China′s service trade export flow by the use of extended gravity model. The study found that the higher the cultural barrier index is, the less the service trade flows. The cultural barriers index decreasing by 10% could lead to the service trade flow increase by 2.23%. China is in the critical transitional period from sizable to powerful service trading country. Therefore, the enhancement of cultural exchange and removal of cultural barriers between China and its trade partners will help China build the image of powerful service trade country and promote the development of Chinese politics, economy and diplomacy.

Key words: Cultural Barrier Index, service trade, gravity model, export flow