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To estimate correctly the effect of variable trade costs on firms’ exports, the gravity equation should control for the number of firms that participate in foreign markets. Due to the absence of these data, previous studies control for this omitted variable using econometric strategies that...
Persistent link: https://www.econbiz.de/10009766156
This paper assesses the role of a larger degree of common language use between the populations of two countries on the so-called extensive product margin of trade. We focus on the overlap of products exported or imported between any pair of countries. The results suggest that the effect of...
Persistent link: https://www.econbiz.de/10010354788
This paper provides a direct test of how fixed export costs and productivity jointly determine firm-level export … behavior. Using Chilean data, we construct indices of fixed export costs for each industry-region-year triplet and match them … to domestic firms. Our empirical results show that firms facing higher fixed export costs are less likely to export …
Persistent link: https://www.econbiz.de/10010256719
We investigate theoretically and empirically how exporters adjust their markups across destinations depending on bilateral distance, tariffs, and the quality of their exports. Under the assumption that trade costs are both ad valorem and per unit, our model predicts that markups rise with...
Persistent link: https://www.econbiz.de/10012157845
development economics: the expansion of firms' export destinations across space and time (chapter 1), the extension of structural …
Persistent link: https://www.econbiz.de/10011742960
The present analysis assessed the effect of Aid-for-Trade (AfT) flows on the shadow economy using an unbalanced panel dataset of 106 countries over the period of 2002 to 2015. The empirical results obtained by means of the two-step system generalized method of moments showed that higher AfT...
Persistent link: https://www.econbiz.de/10013499828
Using firm-level data from France, we document that the shift of economic activity from manufacturing to services over the last few decades has been urban-biased: structural change has been more pronounced in areas with higher population density. This bias can be accounted for by the location...
Persistent link: https://www.econbiz.de/10014469530
Persistent link: https://www.econbiz.de/10011542171
Persistent link: https://www.econbiz.de/10010436359
This paper shows that the R&D intensity of an industry plays an important role in determining international trade patterns via its effect on scale economies. I first develop a model of trade with heterogeneous firms where firms compete with each other by spending on fixed product development...
Persistent link: https://www.econbiz.de/10009632205