FDI vs. Exports: Accounting for Differences in Export-Sales Intensities

Industry level data shows striking differences among sectors in ratios of exports to FDI sales. We determine what is needed to endogenously generate this pattern of export and FDI sales. By calibrating a model of monopolistic competitive firms, we find that tradability of goods is not enough to capture the observed sectoral differences, as is commonly assumed. We explore variants of the model and show that sector-specific taxes on multinationals and home bias allow us to replicate these differences.

Infant Formula Trade and Food Safety

Beginning in 2004, the Chinese formula market suffered from a string of contamination events from counterfeit formula in 2004, melamine in 2008 to mercury and aflatoxin (a human carcinogen) in 2012. In this paper, we seek to understand the effects of these safety concerns in a market which lacks product substitutes. Whereas the literature shows international flows for produce, beef, and poultry are changed by persistent contaminations, the international infant formula market is less responsive to repeated health concerns

Learning to Export: Export Growth and the Destination Decision of Firms

Abstract In this paper, I find evidence that the geographic expansion of firm exports occurs slowly over time and that a large share of export growth is due to incumbent exporters entering new destinations. I also show that aggregated trade data can underestimate this value and hide the differing composition of export destinations by entering and incumbent exporters. New exporters enter large countries and destinations with characteristics similar to their domestic market. Less similar, distant or less developed countries are entered by firms already exporting to other destinations. I formulate a dynamic general equilibrium model to test if these patterns are due to firms learning how to export (as other recent empirical findings have suggested), or exogenous factors such as productivity growth. In this model, heterogeneous firms experience learning in the form of market entry costs that depend on export history. When calibrated to Russian firm level data, I find that learning plays a significant role in explaining the observed entry patterns, which standard trade models cannot account for. Additionally, by taking learning into account and targeting particular export destinations, governments can better assess the impact of liberalizations. JEL Classification: F12, F13, F14, L1

Appendix to the Agglomeration of Exporters by Destination

This appendix documents Russian customs data used in the Annals of Regional Science article published at DOI:10.1007/s00168-012-0538-9. The appendix includes sections on the political organization of Russia and the location of ports and products, Russian exporters and exports, and exports in the context of output

The Agglomeration by Destination of U.S. State Exports

Precise characterization of informational trade barriers is neither well documented nor understood. Using Russian customs data, we document that regional destination-specific export spillovers exist for developing countries, extending a result that was only known for developed countries. This result suggests behavior responding to a destination barrier. To account for this fact, we build on a monopolistic competition model of trade by postulating an externality in the international transaction of goods. We test the model's prediction on region-level exports using Russian data and find improvement over gravity-type models without agglomeration. This finding has important development implications in that export policy that considers current trade partners may be more effective than policy that focuses only on the exporting country's industries. Furthermore, our findings can be considered in the burgeoning literature refining transaction costs beyond the traditional iceberg cost

FDI vs. Exports: Accounting for Differences in Export-Sales Intensities

Datos a nivel de industrias muestran diferencias sectoriales marcadas en la relación entre exportaciones y ventas de multinacionales. Nosotros identificamos lo que es necesario para generar endógenamente estos patrones de exportaciones y ventas de multinacionales. Calibrando un modelo de competencia monopolística, encontramos que diferencias en costos de transporte de los bienes no son suficientes para capturar las diferencias sectoriales observadas, como se asume generalmente. Exploramos variantes al modelo básico y mostramos que impuestos sectoriales específicos a las ventas de multinacionales y home bias nos permiten replicar dichas diferencias