Firms in international trade
By: Andrew B. Bernard ... [et al.]
Contributors: Bernard, Andrew B., 1963-; National Bureau of Economic Research.
Series: NBER working paper series -- no. 13054.; Working paper series (National Bureau of Economic Research) -- working paper no. 13054.
Publisher: National Bureau of Economic Research
Published: 2007
Place of publication: Cambridge, Mass
Language: eng
Number of pages: 29
Subjects: International business enterprises; International trade -- Econometric models; United States -- Commerce -- Econometric models
Description: Despite the fact that importing and exporting are extremely rare firm activities, economists generally devote little attention to the role of firms when discussing international trade. This paper summarizes key differences between trading and non-trading firms, demonstrates how these differences present a challenge to standard trade models and shows how recent "heterogeneous-firm" models of international trade address these challenges. We then make use of transaction-level U.S. trade data to introduce a number of new stylized facts about firms and trade. These facts reveal that the extensive margins of trade -- that is, the number of products firms trade as well as the number of countries with which they trade -- are central to understanding the well-known role of distance in dampening aggregate trade flows.
Notes: "April 2007"

Includes bibliographical references (p. 16-18).

Also available in PDF from the NBER world wide web site (www.nber.org).