International Trade and Intertemporal Substitution

Leibovici, Fernando; Waugh, Michael E.

doi:10.20955/wp.2017.004

Cited by 2 publications

(1 citation statement)

References 82 publications

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“…Indeed, using the World Bank Doing Business data set, we find that across 196 countries, the median time lag between the moment that goods leave the production plant and the time they are loaded on a ship is 18.5 days (in Chile, this delay is 15 days) . In addition, Hummels and Schaur () document that the typical good imported to the United States spends 20 days on a vessel, and Leibovici and Waugh () estimate that the average total time it takes to import a good into the United States increases to 33 days when the data from the World Bank Doing Business data set are taken into account. These long delivery lags associated with exporting further suggest that exporters have higher working‐capital needs than nonexporters.…”

Section: Empirical Evidencementioning

confidence: 99%

Financial Frictions and New Exporter Dynamics

Kohn

Leibovici

Szkup

2016

Int Economic Review

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This article studies the role of financial frictions as a barrier to international trade. We study new exporter dynamics to identify how these frictions affect export decisions. We introduce a borrowing constraint and working capital requirements into a standard model of international trade, with exports more working capital intensive than domestic sales. Our model can quantitatively account for new exporter dynamics in contrast to a model with sunk export entry costs. We provide additional evidence in support of our mechanism. We find that financial frictions reduce the impact of trade liberalization, suggesting that they constitute an important trade barrier. * Manuscript 21 The model still features incomplete markets and a nonnegativity constraint on asset holdings. 22 Note that the analysis in this section is for changes in decision rules given fixed prices, not for general equilibrium effects, which are absent in the model.

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Section: Empirical Evidencementioning

confidence: 99%

Financial Frictions and New Exporter Dynamics

Kohn

Leibovici

Szkup

2016

Int Economic Review

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Trade restrictiveness indexes and welfare: A structural approach

Soderbery

2021

Canadian J of Economics

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Trade restrictiveness indexes (TRIs) have become a staple for practitioners and policy‐makers to summarize international trade barriers. TRIs theoretically found a measure of trade restrictiveness by calculating the uniform tariff that is welfare equivalent to the observed distribution of applied tariffs within a country. Here we incorporate importer market power and exporter heterogeneity into calculations of TRIs and welfare globally. To do so, we structurally estimate a quantitative model of international trade. The structure of the model allows tractable estimation of importer and exporter welfare and TRIs for every country in the world from 1990 to 2007. Canonical estimates, which ignore exporter heterogeneity and importer market power, are shown to overstate efficiency losses from tariffs by a factor of 5 for the average importer. Additionally, by not accounting for importer market power canonical methods fail to measure substantial welfare losses to exporters that are captured by importers through tariffs. These channels are shown to significantly impact the measurement and interpretation of TRIs. To conclude, we employ the methodology to evaluate China's WTO accession and a counterfactual renegotiation of NAFTA.

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International Trade and Intertemporal Substitution

Cited by 2 publications

References 82 publications

Financial Frictions and New Exporter Dynamics

Financial Frictions and New Exporter Dynamics

Trade restrictiveness indexes and welfare: A structural approach

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