Two-Sided Heterogeneity and Trade / Andrew B. Bernard, Andreas Moxnes, Karen Helene Ulltveit-Moe.

Format:

Book

Author/Creator:

Bernard, Andrew B.

Contributor:

National Bureau of Economic Research.

Moxnes, Andreas.

Ulltveit-Moe, Karen Helene.

Series:

Working Paper Series (National Bureau of Economic Research) no. w20136.

NBER working paper series no. w20136

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2014.

Summary:

Empirical studies of firms within industries consistently report substantial heterogeneity in measures of performance such as size and productivity. This paper explores the consequences of joint heterogeneity on the supply side (sellers) and the demand side (buyers) in international trade using a novel transaction-level dataset from Norway. Domestic exporters as well as foreign importers are explicitly identified in each transaction to every destination. The buyer-seller linked data reveal a number of new stylized facts on the distributions of buyers per exporter and exporters per buyer, the matching among sellers and buyers and the variation of buyer dispersion across destinations. The paper develops a model of trade with heterogeneous importers as well as heterogeneous exporters where matches are subject to a relation-specific fixed cost. The model matches the stylized facts and generates new testable predictions emphasizing the importance of importer heterogeneity in explaining trade patterns.

Notes:

Print version record

May 2014.