Two-Sided Heterogeneity and Trade

Andrew B. Bernard; Andreas Moxnes; Karen Helene Ulltveit-Moe

doi:10.1162/rest_a_00721

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Two-Sided Heterogeneity and Trade

Andrew B. Bernard¹; Andreas Moxnes²; Karen Helene Ulltveit-Moe²

¹ Tuck School of Business at Dartmouth, CEPR, and NBER · ² University of Oslo and CEPR

The Review of Economics and Statistics 2018 open access

This paper develops a multicountry model of international trade that provides a simple microfoundation for buyer-seller relationships in trade. We explore a rich data set that identifies buyers and sellers in trade and establish a set of basic facts that guide the development of the theoretical model. We use predictions of the model to examine the role of buyer heterogeneity in a market for firm-level adjustments to trade shocks, as well as to quantitatively evaluate how firms’ marginal costs depend on access to suppliers in foreign markets.

DOI: 10.1162/rest_a_00721
Volume: 100 (3)
Pages: 424-439
Language: en
Export: BibTeX
Sources: crossref openalex