Dissecting the Effect of Credit Supply on Trade: Evidence from Matched Credit-Export Data
AbstractIn this paper we estimate the elasticity of exports to credit shocks. As a source of variation, we exploit the disproportionate reduction in credit supply by banks with high share of foreign liabilities during the 2008 financial crisis. Using matched customs and firm-level bank credit data from Peru, we compare changes in exports of the same product and to the same destination by firms borrowing from different banks, which allows us to account for variation in non-credit determinants of exports. On the intensive margin, the elasticity of exports to credit is 0.23, and it is relatively constant across firms of different size, industry, and other observable characteristics. We find that both the frequency and average size of shipments are sensitive to credit shocks. On the extensive margin, the elasticity of the number of firms that continue supplying a product-destination export market is 0.36, but credit has no effect on the number of entrants. The estimated elasticities imply that the negative credit supply shock accounts for 15% of the drop in Peruvian exports during the financial crisis.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Society for Economic Dynamics in its series 2011 Meeting Papers with number 180.
Date of creation: 2011
Date of revision:
Contact details of provider:
Postal: Society for Economic Dynamics Christian Zimmermann Economic Research Federal Reserve Bank of St. Louis PO Box 442 St. Louis MO 63166-0442 USA
Web page: http://www.EconomicDynamics.org/society.htm
More information through EDIRC
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
- Christian Volpe Martincus & Juan S. Blyde, 2012.
"Shaky Roads and Trembling Exports: Assessing the Trade Effects of Domestic Infrastructure Using a Natural Experiment,"
82533, Inter-American Development Bank.
- Volpe Martincus, Christian & Blyde, Juan, 2013. "Shaky roads and trembling exports: Assessing the trade effects of domestic infrastructure using a natural experiment," Journal of International Economics, Elsevier, vol. 90(1), pages 148-161.
- Michalski, Tomasz & Örs, Evren, 2010.
"(Inter-state) Banking and (Inter-state) Trade: Does Real Integration Follow Financial Integration?,"
CEPR Discussion Papers
7963, C.E.P.R. Discussion Papers.
- Michalski, Tomasz & Ors, Evren, 2012. "(Interstate) Banking and (interstate) trade: Does real integration follow financial integration?," Journal of Financial Economics, Elsevier, vol. 104(1), pages 89-117.
- Bricongne, Jean-Charles & Fontagné, Lionel & Gaulier, Guillaume & Taglioni, Daria & Vicard, Vincent, 2010.
"Firms and the global crisis: French exports in the turmoil,"
Working Paper Series
1245, European Central Bank.
- Bricongne, Jean-Charles & Fontagné, Lionel & Gaulier, Guillaume & Taglioni, Daria & Vicard, Vincent, 2012. "Firms and the global crisis: French exports in the turmoil," Journal of International Economics, Elsevier, vol. 87(1), pages 134-146.
- Bricongne, J-C. & Fontagné, L. & Gaulier, G. & Taglioni, D. & Vicard, V., 2009. "Firms and the global crisis: French exports in the turmoil," Working papers 265, Banque de France.
- HOSONO Kaoru & TAKIZAWA Miho & TSURU Kotaro, 2013. "International Transmission of the 2008-09 Financial Crisis: Evidence from Japan," Discussion papers 13010, Research Institute of Economy, Trade and Industry (RIETI).
- Hosono, Kaoru & Miyakawa, Daisuke & Uchino, Taisuke & Hazama, Makoto & Ono, Arito & Uchida, Hirofumi & Uesugi, Iichiro, 2012.
"Natural Disasters, Damage to Banks, and Firm Investment,"
Working Paper Series
18, Center for Interfirm Network, Institute of Economic Research, Hitotsubashi University.
- HOSONO Kaoru & MIYAKAWA Daisuke & UCHINO Taisuke & HAZAMA Makoto & ONO Arito & UCHIDA Hirofumi & UESUGI Iichiro, 2012. "Natural Disasters, Damage to Banks, and Firm Investment," Discussion papers 12062, Research Institute of Economy, Trade and Industry (RIETI).
- Ari Aisen & Roberto Álvarez & Andrés Sagner & Javier Turén, 2011.
"Credit Contraction and International Trade: Evidence from Chilean Exporters,"
Working Papers Central Bank of Chile
639, Central Bank of Chile.
- Aisen, Ari & Álvarez, Roberto & Sagner, Andrés & Turén, Javier, 2013. "Credit contraction and international trade: Evidence from Chilean exporters," World Development, Elsevier, vol. 44(C), pages 212-224.
- Stijn Claessens & Hui Tong & Shang-Jin Wei, 2011.
"From the Financial Crisis to the Real Economy: Using Firm-level Data to Identify Transmission Channels,"
in: Global Financial Crisis
National Bureau of Economic Research, Inc.
- Claessens, Stijn & Tong, Hui & Wei, Shang-Jin, 2012. "From the financial crisis to the real economy: Using firm-level data to identify transmission channels," Journal of International Economics, Elsevier, vol. 88(2), pages 375-387.
- Stijn Claessens & Hui Tong & Shang-Jin Wei, 2011. "From the Financial Crisis to the Real Economy: Using Firm-level Data to Identify Transmission Channels," NBER Working Papers 17360, National Bureau of Economic Research, Inc.
- Molina, Danielken & Roa, Monica, 2014. "The Effect of Credit on the Export Performance of Colombian Exporters," MPRA Paper 56137, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Christian Zimmermann).
If references are entirely missing, you can add them using this form.