IDEAS home Printed from https://ideas.repec.org/a/spr/weltar/v152y2016i1d10.1007_s10290-015-0230-0.html
   My bibliography  Save this article

Services versus goods trade: a firm-level comparison

Author

Listed:
  • Andrea Ariu

    () (University of Geneva
    Georgetown University
    CRENOS)

Abstract

Abstract Using transaction data from Belgium, we provide a descriptive comparison of trade in goods and trade in services at the firm level. From a static perspective, we find that firms trading services are fewer and export and import smaller values than those trading goods. This is because they trade fewer products, with less countries, making fewer transactions and these gaps are only partially counterbalanced by larger transaction values. Instead, firms trading both services and goods are even rarer, but they account for a substantial share of total trade. In the time dimension, services traders experience higher entry and exit rates and a lower survival probability. However, the surviving firms grow more rapidly than those trading goods thanks to an increase in the number of transactions per product-market. Finally, we observe that firms that trade only services add also goods in their export and import basket and vice versa. This is a further important growth channel for firms in international markets.

Suggested Citation

  • Andrea Ariu, 2016. "Services versus goods trade: a firm-level comparison," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 152(1), pages 19-41, February.
  • Handle: RePEc:spr:weltar:v:152:y:2016:i:1:d:10.1007_s10290-015-0230-0 DOI: 10.1007/s10290-015-0230-0
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s10290-015-0230-0
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. George Alessandria & Joseph P. Kaboski & Virgiliu Midrigan, 2010. "Inventories, Lumpy Trade, and Large Devaluations," American Economic Review, American Economic Association, pages 2304-2339.
    2. Kristian Behrens & Gregory Corcos & Giordano Mion, 2013. "Trade Crisis? What Trade Crisis?," The Review of Economics and Statistics, MIT Press, pages 702-709.
    3. Lawless, Martina, 2009. "Firm export dynamics and the geography of trade," Journal of International Economics, Elsevier, pages 245-254.
    4. Bernard, Andrew B. & Bradford Jensen, J., 1999. "Exceptional exporter performance: cause, effect, or both?," Journal of International Economics, Elsevier, pages 1-25.
    5. Thierry Mayer & Marc J. Melitz & Gianmarco I.P. Ottaviano, 2010. "Market size, competition and the product mix of exporters," Working Paper Research 202, National Bank of Belgium.
    6. repec:bla:worlde:v:40:y:2017:i:9:p:1866-1889 is not listed on IDEAS
    7. Thierry Mayer & Marc J. Melitz & Gianmarco I. P. Ottaviano, 2014. "Market Size, Competition, and the Product Mix of Exporters," American Economic Review, American Economic Association, pages 495-536.
    8. Jonathan Eaton & Samuel Kortum & Francis Kramarz, 2011. "An Anatomy of International Trade: Evidence From French Firms," Econometrica, Econometric Society, pages 1453-1498.
    9. Thierry Mayer & Gianmarco Ottaviano, 2007. "The happy few: the internationalisation of European firms New facts based on firm-level evidence," Sciences Po publications info:hdl:2441/10147, Sciences Po.
    10. Mion, Giordano & Zhu, Linke, 2013. "Import competition from and offshoring to China: A curse or blessing for firms?," Journal of International Economics, Elsevier, pages 202-215.
    11. Joseph Francois & Bernard Hoekman, 2010. "Services Trade and Policy," Journal of Economic Literature, American Economic Association, pages 642-692.
    12. Mirabelle Muûls & Mauro Pisu, 2009. "Imports and Exports at the Level of the Firm: Evidence from Belgium," The World Economy, Wiley Blackwell, vol. 32(5), pages 692-734, May.
    13. Thierry Mayer & Gianmarco Ottaviano, 2008. "The Happy Few: The Internationalisation of European Firms," Intereconomics: Review of European Economic Policy, Springer;German National Library of Economics;Centre for European Policy Studies (CEPS), vol. 43(3), pages 135-148, May.
    14. Andrew Bernard & J Bradford Jensen & Stephen Redding & Peter Schott, 2009. "The Margins of U.S. Trade (Long Version)," Working Papers 09-18, Center for Economic Studies, U.S. Census Bureau.
    15. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2012. "The Empirics of Firm Heterogeneity and International Trade," Annual Review of Economics, Annual Reviews, vol. 4(1), pages 283-313, July.
    16. Andrea Ariu & Giordano Mion, 2017. "Service Trade and Occupational Tasks: An Empirical Investigation," The World Economy, Wiley Blackwell, vol. 40(9), pages 1866-1889, September.
    17. Albornoz, Facundo & Calvo Pardo, Héctor F. & Corcos, Gregory & Ornelas, Emanuel, 2012. "Sequential exporting," Journal of International Economics, Elsevier, pages 17-31.
    18. Bernard, Andrew B. & Moxnes, Andreas & Ulltveit-Moe, Karen-Helene, 2013. "Two-sided Heterogeneity and Trade," CEPR Discussion Papers 9681, C.E.P.R. Discussion Papers.
    19. Andrew B. Bernard & Stephen J. Redding & Peter K. Schott, 2011. "Multiproduct Firms and Trade Liberalization," The Quarterly Journal of Economics, Oxford University Press, vol. 126(3), pages 1271-1318.
    20. Thierry Mayer & Marc J. Melitz & Gianmarco I. P. Ottaviano, 2014. "Market Size, Competition, and the Product Mix of Exporters," American Economic Review, American Economic Association, pages 495-536.
    21. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2009. "The Margins of US Trade," American Economic Review, American Economic Association, pages 487-493.
    22. Marcela Eslava & James Tybout & David Jinkins & C. Krizan & Jonathan Eaton, 2015. "A Search and Learning Model of Export Dynamics," 2015 Meeting Papers 1535, Society for Economic Dynamics.
    23. Ines Buono & Harald Fadinger & Stefan Berger, 2008. "The Micro Dynamic of Exporting-Evidence from French Firms," Vienna Economics Papers 0901, University of Vienna, Department of Economics.
    24. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2009. "The Margins of US Trade," American Economic Review, American Economic Association, pages 487-493.
    25. Markus Kelle & Jörn Kleinert, 2010. "German Firms in Service Trade," Applied Economics Quarterly (formerly: Konjunkturpolitik), Duncker & Humblot, Berlin, vol. 56(1), pages 51-72.
    26. Thierry Mayer & Marc J. Melitz & Gianmarco I. P. Ottaviano, 2014. "Market Size, Competition, and the Product Mix of Exporters," American Economic Review, American Economic Association, pages 495-536.
    27. Cédric Duprez, 2011. "International trade in services. A growing contribution to Belgium’s current balance," Economic Review, National Bank of Belgium, pages 53-68.
    28. Breinlich, Holger & Criscuolo, Chiara, 2011. "International trade in services: A portrait of importers and exporters," Journal of International Economics, Elsevier, pages 188-206.
    29. Hornok, Cecília & Koren, Miklós, 2015. "Administrative barriers to trade," Journal of International Economics, Elsevier, pages 110-122.
    30. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
    31. Joseph Francois & Bernard Hoekman, 2010. "Services Trade and Policy," Journal of Economic Literature, American Economic Association, pages 642-692.
    32. Breinlich, Holger & Criscuolo, Chiara, 2011. "International trade in services: A portrait of importers and exporters," Journal of International Economics, Elsevier, pages 188-206.
    33. Caballero, Ricardo J., 1999. "Aggregate investment," Handbook of Macroeconomics,in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 12, pages 813-862 Elsevier.
    34. Matthew Blackwell & James Honaker & Gary King, 2017. "A Unified Approach to Measurement Error and Missing Data: Overview and Applications," Sociological Methods & Research, , vol. 46(3), pages 303-341, August.
    35. repec:spo:wpecon:info:hdl:2441/10147 is not listed on IDEAS
    36. Facundo Albornoz & Hector Calvo-Pardo & Gregory Corcos & Emanuel Ornelas, 2012. "Sequential exporting: how firms break into foreign markets," CentrePiece - The Magazine for Economic Performance 364, Centre for Economic Performance, LSE.
    37. Bernard, Andrew B. & Bradford Jensen, J., 1999. "Exceptional exporter performance: cause, effect, or both?," Journal of International Economics, Elsevier, pages 1-25.
    38. Thierry Mayer & Marc J. Melitz & Gianmarco I. P. Ottaviano, 2014. "Market Size, Competition, and the Product Mix of Exporters," American Economic Review, American Economic Association, pages 495-536.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Andrea Ariu & Elena Biewen & Sven Blank & Guillaume Gaulier & María Jesus González, & Philipp Meinen, & Daniel Mirza & Cesar Martín, & Patry Tello, 2017. "Firm heterogeneity and aggregate business services exports : Micro evidence from Belgium, France, Germany and Spain," Working Paper Research 328, National Bank of Belgium.
    2. Andrea Ariu & Holger Breinlich & Gregory Corcos & Giordano Mion, 2017. "The interconnections between services and goods trade at the firm-level," Working Paper Research 329, National Bank of Belgium.
    3. Andrea Ariu & Elena Biewen & Sven Blank & Guillaume Gaulier & María Jesus González, & Philipp Meinen, & Daniel Mirza & Cesar Martín, & Patry Tello, 2017. "Firm heterogeneity and aggregate business services exports : Micro evidence from Belgium, France, Germany and Spain," Working Paper Research 328, National Bank of Belgium.
    4. Crozet, Matthieu & Milet, Emmanuel & Mirza, Daniel, 2016. "The impact of domestic regulations on international trade in services: Evidence from firm-level data," Journal of Comparative Economics, Elsevier, pages 585-607.

    More about this item

    Keywords

    Trade in services; Trade in goods; Dynamics;

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L80 - Industrial Organization - - Industry Studies: Services - - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:weltar:v:152:y:2016:i:1:d:10.1007_s10290-015-0230-0. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Rebekah McClure). General contact details of provider: http://www.springer.com .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.