Mehl, Arnaud; Schmitz, Martin; Tille, Cédric - 2019 - This version: March 2019
Does distance matter for the volatility of international real and financial transactions? We show that it does, in … addition to its well-established relevance for the level of trade. A simple model of trade with endogenous markups shows that … demand shocks have a larger impact on trade between more distant countries. We test this implication in two steps, relying on …
