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Trade crisis?: what trade crisis?

Behrens, Kristian and Corcos, Gregory and Mion, Giordano (2013) Trade crisis?: what trade crisis? Review of Economics and Statistics, 95 (2). pp. 702-709. ISSN 0034-6535

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Identification Number: 10.1162/REST_a_00287

Abstract

We investigate the dramatic 2008–2009 trade collapse using microdata from a small open economy, Belgium. Belgian trade essentially fell because of reduced quantities and unit prices, rather than fewer firms involved in international transactions, fewer trading partners per firm, or fewer products traded. Our difference-in-difference results point to a fall in the demand for tradables – especially durables and capital goods – as the main driver of the recent collapse. Finance and involvement in global value chains played only minor roles. Firm-level exports-to-turnover and imports-to-intermediates – as well as exports-to-production and imports-to-production – ratios reveal a comparable collapse of domestic and cross-border operations. Access to credit affected both types of activities to the same extent. Overall, our results point to a general fall in demand and not a crisis of Belgian cross-border trade per se.

Item Type: Article
Official URL: http://www.mitpressjournals.org/loi/rest
Additional Information: © 2012 The President and Fellows of Harvard College and the Massachusetts Institute of Technology
Subjects: H Social Sciences > HC Economic History and Conditions
H Social Sciences > HF Commerce
Sets: Departments > Geography and Environment
Research centres and groups > Spatial Economics Research Centre
Research centres and groups > Centre for Economic Performance (CEP)
Date Deposited: 20 Mar 2012 11:37
Last Modified: 27 Jun 2014 15:43
URI: http://eprints.lse.ac.uk/id/eprint/42664

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