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Distance Sensitivity of Export: A Firm-Product Level Approach

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    Abstract

    Recent literature suggests that product characteristics assert different distance sensitivity on trade flows. But the empirical evidences still find conflicting results. Previous studies have examined the effect of distance on the export decisions across different product groups at the aggregate level. In this paper the analyses are executed at a disaggregated firm-product level to examine the issue based on individual firm's decisions. Empirically, I employ a gravity model on Swedish micro-level export data in the manufacturing sector. The results suggest that homogeneous products are more sensitive to distance than differentiated products for the export selection and are insignificant for the export intensity.

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    File URL: http://project.nek.lu.se/publications/workpap/papers/WP12_33.pdf
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    Bibliographic Info

    Paper provided by Lund University, Department of Economics in its series Working Papers with number 2012:33.

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    Length: 24 pages
    Date of creation: 06 Dec 2012
    Date of revision:
    Handle: RePEc:hhs:lunewp:2012_033

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    Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund,Sweden
    Phone: +46 +46 222 0000
    Fax: +46 +46 2224613
    Web page: http://www.nek.lu.se/en
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    Keywords: distance sensitivity; export decisions; gravity model; micro-data;

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    1. James E. Anderson & Eric van Wincoop, 2001. "Gravity with Gravitas: A Solution to the Border Puzzle," NBER Working Papers 8079, National Bureau of Economic Research, Inc.
    2. Gert-Jan M. Linders & Henri L.F. de Groot, 2006. "Estimation of the Gravity Equation in the Presence of Zero Flows," Tinbergen Institute Discussion Papers 06-072/3, Tinbergen Institute.
    3. James E. Anderson & Douglas Marcouiller, S.J., 1999. "Insecurity and the Pattern of Trade: An Empirical Investigation," Boston College Working Papers in Economics 418, Boston College Department of Economics, revised 03 Aug 2000.
    4. Peter Egger & Michael Pfaffermayr, 2011. "Structural Estimation of Gravity Models with Path-Dependent Market Entry," FIW Research Reports series, FIW III-007, FIW.
    5. Rubén Segura-Cayuela & Josep M. Vilarrubia, 2008. "Uncertainty and entry into export markets," Banco de Espa�a Working Papers 0811, Banco de Espa�a.
    6. Jonathan Eaton & Samuel Kortum, 2002. "Technology, Geography, and Trade," Econometrica, Econometric Society, Econometric Society, vol. 70(5), pages 1741-1779, September.
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