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What drives exporters’ market dynamics? A new framework for disentangling micro shocks

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  • Han, Lu

Abstract

Exporters frequently change their set of destination markets. This paper proposes a new approach to identifying the underlying drivers of changes in exporters’ market decisions over time. The approach exploits information on price and quantity changes in firms’ continuing markets to disentangle the micro shocks that drive firms’ market changes. Applying the method to customs data from China (2000–2006) and the UK (2010–2016), I find consistent results showing that most firm- and firm-product-level market changes are driven by demand-related shocks, with a nontrivial proportion of these changes being correlated across markets.

Suggested Citation

  • Han, Lu, 2026. "What drives exporters’ market dynamics? A new framework for disentangling micro shocks," Journal of International Economics, Elsevier, vol. 159(C).
    • Handle: RePEc:eee:inecon:v:159:y:2026:i:c:s0022199625001436
    DOI: 10.1016/j.jinteco.2025.104186
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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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