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Importing, Exporting And Firm-Level Employment Volatility

Listed author(s):
  • Christopher Kurz
  • Mine Z. Senses

In this paper, we use detailed trade and transactions data for the U.S. manufacturing sector to empirically analyze the direction and magnitude of the association between firm-level exposure to trade and the volatility of employment growth. We find that, relative to purely domestic firms, firms that only export and firms that both export and import are less volatile, whereas firms that only import are more volatile. The positive relationship between importing and volatility is driven mainly by firms that switch in and out of importing. We also document a significant degree of heterogeneity across trading firms in terms of the duration of time and intensity with which firms trade, the number and type of products they trade and the number and characteristics of their trading partners. We find these factors to play an important role in explaining the differential impact of trading on employment volatility experienced by these firms.

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File URL: ftp://ftp2.census.gov/ces/wp/2013/CES-WP-13-31.pdf
File Function: First version, 2013
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Paper provided by Center for Economic Studies, U.S. Census Bureau in its series Working Papers with number 13-31.

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Length: 40 pages
Date of creation: Jun 2013
Handle: RePEc:cen:wpaper:13-31
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