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The Network Structure of International Trade

Abstract : Motivated by empirical evidence I uncover on the dynamics of French firms’ exports, I offer a novel theory of trade frictions. Firms export only into markets where they have a contact. They search directly for new trading partners, but also use their existing network of contacts to search remotely for new partners. I characterize the dynamic formation of an international network of exporters in this model. Structurally, I estimate this model on French data and confirm its predictions regarding the distribution of the number of foreign markets accessed by exporters and the geographic distribution of exports.
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Submitted on : Friday, February 18, 2022 - 11:05:23 AM
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Thomas Chaney. The Network Structure of International Trade. American Economic Review, American Economic Association, 2014, 104 (11), pp.3600 - 3634. ⟨10.1257/aer.104.11⟩. ⟨hal-03579668⟩

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