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Who uses intermediaries in international trade? Evidence from firm-level survey data

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  • Jennifer Abel-Koch

Abstract

The present paper uses data from the World Bank Enterprise Survey conducted in Turkey in 2005 to shed light on the firms which use intermediaries in international trade. It lends robust empirical support to recent theories which suggest that indirect exporters are mostly small firms which are not profitable enough to cover the high fixed costs of building their own distribution network abroad. Manufacturers which introduce entirely new products to foreign markets are more likely to use trade intermediaries, as are firms which produce low quality goods. In contrast, neither foreign ownership nor credit constraints are correlated with the choice of export mode. Moreover, firms which rely on trade intermediaries to sell their goods abroad also do so to source their foreign inputs, implying that the role of intermediaries in facilitating trade may be larger than previous studies suggest.

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Paper provided by University of Nottingham, GEP in its series Discussion Papers with number 11/25.

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Handle: RePEc:not:notgep:11/25

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Keywords: Heterogeneous firms; intermediated trade;

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Cited by:
  1. Horst Raff & Natalia Trofimenko, 2013. "World Market Access of Emerging-Market Firms: The Role of Foreign Ownership and Access to External Finance," CESifo Working Paper Series 4346, CESifo Group Munich.
  2. Jonathan Timmis, 2013. "Internet Adoption and Firm Exports in Developing Economies," Discussion Papers 2013-05, University of Nottingham, GEP.
  3. A. Kerem Cosar & Banu Demir, 2014. "Domestic Road Infrastructure and International Trade: Evidence from Turkey," Koç University-TUSIAD Economic Research Forum Working Papers 1406, Koc University-TUSIAD Economic Research Forum.
  4. Ruiz, Manuel, 2014. "Elección de los Modos de Exportación: Evidencia de Empresas Peruanas," Working Papers 2014-004, Banco Central de Reserva del Perú.

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