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Intra-national Home Bias: Some Explanations

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Russell Hillberry
David Hummels

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Abstract

Wolf (2000) demonstrates that trade within the U.S. appears substantially impeded by state borders. We revisit this finding with improved data. We show that much intra-national home bias can be explained by wholesaling activity. Shipments by wholesalers are much more localized within states than shipments from manufacturing establishments. Controlling for relative prices and the use of actual, rather than imputed, shipment distances also reduces home bias estimates.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 9022.

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Date of creation: Jun 2002
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Handle: RePEc:nbr:nberwo:9022

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Find related papers by JEL classification:
F15 - International Economics - - Trade - - - Economic Integration
R12 - Urban, Rural, and Regional Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  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. [Downloadable!] (restricted)
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  2. John F. Helliwell & Geneviève Verdier, 2001. "Measuring internal trade distances: a new method applied to estimate provincial border effects in Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 34(4), pages 1024-1041, November. [Downloadable!] (restricted)
  3. Russell Hillberry & David Hummels, 2002. "Explaining Home Bias in Consumption: The Role of Intermediate Input Trade," NBER Working Papers 9020, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  4. McCallum, John, 1995. "National Borders Matter: Canada-U.S. Regional Trade Patterns," American Economic Review, American Economic Association, vol. 85(3), pages 615-23, June. [Downloadable!] (restricted)
  5. Volker Nitsch, 2000. "National borders and international trade: evidence from the European Union," Canadian Journal of Economics, Canadian Economics Association, vol. 33(4), pages 1091-1105, November. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Yilmazkuday, Hakan, 2009. "Understanding Interstate Trade Patterns," MPRA Paper 15952, University Library of Munich, Germany. [Downloadable!]
  2. Nikolaus Wolf, 2008. "Was Germany ever United? Evidence from Intra- and International Trade 1885 - 1933," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
    Other versions:
  3. Chintrakarn, Pandej & Millimet, Daniel, 2005. "The Environmental Consequences of Trade: Evidence from Subnational Trade Flows," Departmental Working Papers 0501, Southern Methodist University, Department of Economics. [Downloadable!]
    Other versions:
  4. Chintrakarn, Pandej & Millimet, Daniel, 2006. "Subnational Trade Flows and State-Level Energy Intensity," Departmental Working Papers 0601, Southern Methodist University, Department of Economics. [Downloadable!]
  5. Diego Puga, 2008. "Agglomeration and cross-border infrastructure," Working Papers 2008-06, Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales. [Downloadable!]
    Other versions:
  6. Daniel Trefler & Susan Chun Zhu, 2005. "The Structure of Factor Content Predictions," NBER Working Papers 11221, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  7. James E. Anderson & Eric van Wincoop, 2004. "Trade Costs," Journal of Economic Literature, American Economic Association, vol. 42(3), pages 691-751, September. [Downloadable!] (restricted)
    Other versions:
  8. Millimet, Daniel & Henderson, Daniel, 2006. "Is Gravity Linear?," Departmental Working Papers 0517, Southern Methodist University, Department of Economics. [Downloadable!]
    Other versions:
  9. Philipp Maier, 2005. "A `Global Village' without borders? International price differentials at eBay," DNB Working Papers 044, Netherlands Central Bank, Research Department. [Downloadable!]
    Other versions:
  10. Matthias Helble, 2007. "Border Effect Estimates for France and Germany Combining International Trade and Intranational Transport Flows," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 143(3), pages 433-463, October. [Downloadable!] (restricted)
  11. C. Reggiani & G. Rossini, 2006. "Home Bias among European Students," Working Papers 579, Dipartimento Scienze Economiche, Universita' di Bologna. [Downloadable!]
  12. Ali Hortaçsu & F. Asís Martínez-Jerez & Jason Douglas, 2006. "The Geography of Trade on eBay and MercadoLibre," Working Papers 06-09, NET Institute, revised Sep 2006. [Downloadable!]
  13. Yilmazkuday, Hakan, 2009. "Distribution of Consumption, Production and Trade within the U.S," MPRA Paper 16361, University Library of Munich, Germany. [Downloadable!]
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