Models of heterogeneous firms with selection into export market participation generically exhibit aggregate trade elasticities that vary across country-pairs. Only when heterogeneity is assumed Pareto-distributed do all elasticities collapse into a unique elasticity, estimable with a gravity...

In this paper, we show that exporters react more strongly to a cut in tariffs by a distant countrywhen their banks have already been specializing in funding exports to this country. To make ourcase, we build upon a theoretical model where an informational advantage provided by theexporter's bank...