Working Papers

Network Effects in Export Markets: Evidence from Matched Exporter-Importer Data

Reject and Resubmit at Journal of International Economics

Abstract: This paper provides novel causal evidence of network effects in export markets. Using Danish firm-to-firm trade data, I show that a larger existing buyer network leads to more new buyer relationships. Specifically, one additional buyer match in the previous year leads to 0.2 new buyer matches. I establish causality by exploiting variation in exporters’ access to export promotion services. I complement the direct, causal evidence with indirect, correlational evidence based on observed price variation both in the cross-section and over time. Network effects explain about half the total accumulation of buyers by Danish exporters and, hence, is an important driver of total export growth. These findings have important implications for the optimal design of trade policies: Matching new exporters to foreign importers should be a primary objective.

Publications

Do Export Support Programs affect Prices, Quality, Markups and Marginal Costs? Evidence from a Natural Policy Experiment

Forthcoming at The Review of Economics and Statistics

With: Jakob R. Munch, Joel Rodrigue, and Georg Schaur

Work in Progress

R&D Employment and Transmission in Trade and MNE Networks: Evidence from a R&D Tax Reform

With: Björn T. Arnarson, Jakob R. Munch, and Georg Schaur

Growing Together and Apart: Scale Economies and Specialization

With: Björn T. Arnarson, Andreas Moxnes, Jakob R. Munch, and Chong Xiang

Policy Relevant Information Frictions in Export Markets

With: Jakob R. Munch, Joel Rodrigue, and Georg Schaur

Risky Business: Export Finance Insurance and Trade

With: Thilo Kroeger, Kalina Manova, and Jakob R. Munch