The Collapse of International Trade During the 2008-2009 Crisis: In Search of the Smoking Gun
One of the most striking aspects of the recent recession is the collapse in international trade. This paper uses disaggregated quarterly and monthly data on U.S. imports and exports to shed light on the anatomy of this collapse. We find that the recent reduction in trade relative to overall economic activity is far larger than in previous downturns. Information on quantities and prices of both domestic absorption and imports reveals a more than 50% shortfall in imports, relative to what would be predicted by a simple import demand relationship. In a sample of imports and exports disaggregated at the 6-digit NAICS level, we find that sectors used as intermediate inputs experienced significantly higher percentage reductions in both imports and exports. We also find support for compositional effects: sectors with larger reductions in domestic output had larger drops in trade. By contrast, we find no support for the hypothesis that trade credit played a role in the recent trade collapse.
Year of publication: |
2010
|
---|---|
Authors: | Lewis, Logan ; Tesar, Linda ; Levchenko, Andrei |
Institutions: | Society for Economic Dynamics - SED |
Saved in:
Saved in favorites
Similar items by person
-
Exports versus Multinational Production under Nominal Uncertainty
Lewis, Logan, (2011)
-
Menu Costs, Trade Flows, and Exchange Rate Volatility
Lewis, Logan, (2013)
-
Firms, Destinations, and Aggregate Fluctuations
Mejean, Isabelle, (2013)
- More ...