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Trade intermediation by producers

Author

Listed:
  • Aksel Erbahar

    (Erasmus School of Economics - Erasmus University Rotterdam)

  • Vincent Rebeyrol

    (TSE-R - Toulouse School of Economics - UT Capitole - Université Toulouse Capitole - UT - Université de Toulouse - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

Abstract

This paper shows that manufacturing exporters export goods that they have not produced and thus also act as trade intermediaries. The geographical dimension of the data reveals that almost half of these exports of "sourced" products are purely intermediated: to many destinations, firms export sourced products only. We find that this type of intermediation is ubiquitous across firms, products, and destinations, and is robust to a battery of alternative definitions. These findings show that trade intermediation by producers (TIP) is not solely driven by carry-along trade, where produced and sourced products are bundled when exported. Our decomposition of TIP highlights that trade intermediation should be identified at the firm-product-destination level. The prevalence of pure intermediation for all manufacturing exporters, including the largest ones, suggests that intermediation plays an important role in firms' participation and success in international markets.

Suggested Citation

  • Aksel Erbahar & Vincent Rebeyrol, 2023. "Trade intermediation by producers," Post-Print hal-03903405, HAL.
    • Handle: RePEc:hal:journl:hal-03903405
    DOI: 10.1016/j.jinteco.2022.103693
    Note: View the original document on HAL open archive server: https://hal.science/hal-03903405
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    Cited by:

    1. Fauth Matthias & Jung Benjamin & Kohler Wilhelm, 2023. "German Firms in International Trade: Evidence from Recent Microdata," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 243(3-4), pages 199-284, June.
    2. Leonardo Baccini & Arianna Bondi & Matteo Fiorini, 2023. "Global Value Chains and the Design of Trade Agreements," RSCAS Working Papers 2013_56, European University Institute.
    3. Matthias Fauth & Benjamin Jung & Wilhelm Kohler, 2023. "German Firms in International Trade: Evidence from Recent Microdata," CESifo Working Paper Series 10523, CESifo.

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    More about this item

    Keywords

    Trade intermediation; Intermediaries; Carry-along trade; Multi-product firms;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

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