The Intensive Margin in Trade

Fernandes, Ana M.; Klenow, Peter J.; Meleshchuk, Sergii; Pierola, Denisse; Rodrı́guez-Clare, Andrés

doi:10.2139/ssrn.3352904

Cited by 5 publications

(1 citation statement)

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“…While recent research have predominantly explored the impact of digital technologies on the intensive margin of trade (Feng et al, 2023; Zhou et al, 2022), the substantial relevance of the extensive margin of trade persists in this study, given its pronounced influence on trade flows. According to forecasts derived from the Melitz model, approximately 50% of variation in exports can be attributed to the extensive margin of trade, emphasizing its crucial role in trade dynamics (Fernandes et al, 2023). Additionally, traditional trade flow estimates are biased due to the omission of the extensive margin (Helpman et al, 2008).…”

Section: Methodsmentioning

confidence: 99%

The nonlinear relationship between digital affordances and firm‐level export performance: The moderating role of organizational ambidexterity

Erdey,

Liu,

Nagy

2024

Manage Decis Econ

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A diminished trade cost has been ascribed to the advancement of digital transformation, particularly digital technologies and platforms. Nevertheless, whether this decline in trade costs manifests in the extensive or intensive margin of trade remains an unresolved query. This study conducts a comprehensive analysis of the influence of digital affordances on firm‐level export performance. Specifically, we posit that digital affordances will manifest a convex influence on firms' export decisions and intensive margin of export. Furthermore, we propose that the relationship between digital affordances and firm‐level export decisions will be contingent upon the degree of firms' organizational ambidexterity. To empirically test our hypotheses, we leverage a dataset comprising 13,251 firm‐level observations gathered by the World Bank Enterprise Surveys (WBES) unit across 19 Organization for Economic Cooperation and Development (OECD) countries. Our study substantiates a U‐shaped nexus between digital affordances and firm‐level export performance. Importantly, our analysis supports that this U‐shaped nexus is accentuated when firms present a high level of organizational ambidexterity.

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Section: Methodsmentioning

confidence: 99%

The nonlinear relationship between digital affordances and firm‐level export performance: The moderating role of organizational ambidexterity

Erdey,

Liu,

Nagy

2024

Manage Decis Econ

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The breadth of preferential trade agreements and the margins of exports

Falvey

Foster‐McGregor

2021

Rev World Econ

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We use recently available data on the core economic provisions of PTAs to identify which (types of) provisions seem to promote bilateral exports and the intensive and extensive margins of exports. Our evidence suggests that measures applied at the border tend to be aimed at expanding existing trade, while measures applied behind the border are aimed at creating trade in new products. Preferential measures tended to increase bilateral total exports and bilateral exports at the intensive margin, but have no significant effect on bilateral exports at the extensive margin. Measures applied on an MFN basis are unlikely to provide improved market access for PTA partners. When included individually we find that no provision has a statistically significant effect of the same sign on both trade margins, confirming the view that existing and potential exporters have opposing interests in PTA formation. Finally, we provide estimated effects for selected PTAs.

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Credit frictions, selection into external finance and gains from trade

Unger¹

2021

Canadian J of Economics

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This paper analyzes the effects of credit frictions in a trade model where heterogeneous firms select both into exporting and into two types of external finance. While small producers face stronger credit frictions and rely on bank finance, large firms have access to cheaper bond finance. The analysis shows that a bank credit shock leads to an increase in the share of firms that use bond finance. This selection effect is used to explain the observed decrease in bank finance relative to bond finance during the global financial crisis of 2007–2009. A calibration of the model to the crisis period documents that endogenous selection into external finance reduces the negative implications of credit frictions on product variety, exports and gains from trade.

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The Intensive Margin in Trade

Cited by 5 publications

References 0 publications

The nonlinear relationship between digital affordances and firm‐level export performance: The moderating role of organizational ambidexterity

The nonlinear relationship between digital affordances and firm‐level export performance: The moderating role of organizational ambidexterity

The breadth of preferential trade agreements and the margins of exports

Credit frictions, selection into external finance and gains from trade

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