The Review of Economics and Statistics Vol. 105 No. 6 2023
Assortative Matching of Exporters and Importers
Abstract
This paper studies how exporting and importing firms match based on their capability by investigating the change in such exporter-importer matching during trade liberalization. During the recent liberalization of the Mexico-U.S. textile and apparel trade, exporters and importers often switch their main partners as well as change trade volumes. We develop a many-to-many matching model of exporters and importers where partner switching is the principal margin of adjustment, featuring Beckerian positive assortative matching by capability. Trade liberalization achieves efficient global buyer-supplier matching and improves consumer welfare by inducing systematic partner switching. The data confirm the predicted partner-switching patterns.
- DOI
- 10.1162/rest_a_01114
- Volume
- 105
- Issue
- 6
- Pages
- 1544-1561
- Language
- en
- Sources
- bibtex:phds-export.bib openalex crossref