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The margins of trade: market entry and sector spillovers, the case of Italy (1862-1913)

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  • Jacopo Timini

    () (Banco de España)

Abstract

Between its Unification and WWI, Italy faced a period of increasing participation in the international economy. The growth of Italian exports was gradual, and alternately promoted by its intensive and extensive margins. In this paper, using a disaggregated database at country-product level, I first construct the intensive (average export per product) and extensive (number of products) margins of trade (for Italian imports and exports) and, second, within a quasi-gravity model framework, I estimate the drivers of market entry for Italian exports (1862-1913), with particular attention to the presence of eventual sector spillover effects. I find that the presence of “similar” exported products increased the probability of entry in the destination market (export spillovers), even if with diminishing marginal effects, potentially linked to a “saturation”/“congestion” of the market. Equally, I find that the higher the imports’ growth rate for a specific product, the more likely it was to be internationalised by Italian exporters (import spillovers).

Suggested Citation

  • Jacopo Timini, 2018. "The margins of trade: market entry and sector spillovers, the case of Italy (1862-1913)," Working Papers 1836, Banco de España;Working Papers Homepage.
  • Handle: RePEc:bde:wpaper:1836
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    4. Sergio Mayordomo & Omar Rachedi, 2019. "The China syndrome affects banks: the credit supply channel of foreign import competition," Working Papers 1908, Banco de España;Working Papers Homepage.
    5. Luca Fornaro & Federica Romei, 2016. "The paradox of global thrift," Economics Working Papers 1609, Department of Economics and Business, Universitat Pompeu Fabra, revised Apr 2019.
    6. Christian Castro & Jorge E. Galán, 2019. "Drivers of Productivity in the Spanish Banking Sector: Recent Evidence," Journal of Financial Services Research, Springer;Western Finance Association, vol. 55(2), pages 115-141, June.
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    More about this item

    Keywords

    international trade; market entry; Italy; trade margins; export spillovers;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • N73 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: Pre-1913

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