Trade Flows, Multilateral Resistance and Firm Heterogeneity.
We present a gravity model that accounts for multilateral resistance, firm heterogeneity and country-selection into trade, while accommodating asymmetries in trade flows. A new equation for the proportion of exporting firms takes a gravity form: the extensive margin is also affected by multilateral...
| Main Authors: | , |
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| Format: | Working paper |
| Language: | English |
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Department of Economics (University of Oxford)
2009
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| _version_ | 1797089565193797632 |
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| author | Behar, A Nelson, B |
| author_facet | Behar, A Nelson, B |
| author_sort | Behar, A |
| collection | OXFORD |
| description | We present a gravity model that accounts for multilateral resistance, firm heterogeneity and country-selection into trade, while accommodating asymmetries in trade flows. A new equation for the proportion of exporting firms takes a gravity form: the extensive margin is also affected by multilateral resistance. If all countries reduce their trade frictions, the impact of multilateral resistance is so strong that bilateral trade falls in many cases. This is despite the larger trade elastictiies implied by firm heterogeneity. For isolated bilateral changes in trade frictions, multilateral resistance effects are small for most countries, but are large when big importers are involved. |
| first_indexed | 2024-03-07T03:05:56Z |
| format | Working paper |
| id | oxford-uuid:b27ec4cc-3e18-403b-bbca-43d19d8eb6a2 |
| institution | University of Oxford |
| language | English |
| last_indexed | 2024-03-07T03:05:56Z |
| publishDate | 2009 |
| publisher | Department of Economics (University of Oxford) |
| record_format | dspace |
| spelling | oxford-uuid:b27ec4cc-3e18-403b-bbca-43d19d8eb6a22022-03-27T04:12:20ZTrade Flows, Multilateral Resistance and Firm Heterogeneity.Working paperhttp://purl.org/coar/resource_type/c_8042uuid:b27ec4cc-3e18-403b-bbca-43d19d8eb6a2EnglishDepartment of Economics - ePrintsDepartment of Economics (University of Oxford)2009Behar, ANelson, BWe present a gravity model that accounts for multilateral resistance, firm heterogeneity and country-selection into trade, while accommodating asymmetries in trade flows. A new equation for the proportion of exporting firms takes a gravity form: the extensive margin is also affected by multilateral resistance. If all countries reduce their trade frictions, the impact of multilateral resistance is so strong that bilateral trade falls in many cases. This is despite the larger trade elastictiies implied by firm heterogeneity. For isolated bilateral changes in trade frictions, multilateral resistance effects are small for most countries, but are large when big importers are involved. |
| spellingShingle | Behar, A Nelson, B Trade Flows, Multilateral Resistance and Firm Heterogeneity. |
| title | Trade Flows, Multilateral Resistance and Firm Heterogeneity. |
| title_full | Trade Flows, Multilateral Resistance and Firm Heterogeneity. |
| title_fullStr | Trade Flows, Multilateral Resistance and Firm Heterogeneity. |
| title_full_unstemmed | Trade Flows, Multilateral Resistance and Firm Heterogeneity. |
| title_short | Trade Flows, Multilateral Resistance and Firm Heterogeneity. |
| title_sort | trade flows multilateral resistance and firm heterogeneity |
| work_keys_str_mv | AT behara tradeflowsmultilateralresistanceandfirmheterogeneity AT nelsonb tradeflowsmultilateralresistanceandfirmheterogeneity |