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The U.S. Multinational Advantage during the 2008-2009 Financial Crisis: The Role of Services Trade

Author

Listed:
  • Fariha Kamal
  • Zachary Kroff

Abstract

We document the augmenting role of services exports in U.S. multinationals' goods-export growth during the global financial crisis. Using newly linked data on U.S. firms' foreign sales of goods and services and a triple-difference identification strategy combined with propensity-score matching, we find that compared to multinationals that only export goods (mono-exporters), multinationals that also export services to the same destination (bi-exporters) experienced higher goods-export growth. This result is driven by sales of intellectual property rights related to industrial processes (e.g., patents, trademarks). We also find higher growth in bi-exporters' foreign affiliate services sales and domestic employment in services sectors. These results reveal a pivotal role of services exports in supporting foreign demand for U.S. goods during the crisis.

Suggested Citation

  • Fariha Kamal & Zachary Kroff, 2026. "The U.S. Multinational Advantage during the 2008-2009 Financial Crisis: The Role of Services Trade," Working Papers 26-04, Center for Economic Studies, U.S. Census Bureau.
    • Handle: RePEc:cen:wpaper:26-04
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    File URL: https://www2.census.gov/library/working-papers/2026/adrm/ces/CES-WP-26-04.pdf
    File Function: First version, 2026
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    More about this item

    Keywords

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    JEL classification:

    • F1 - International Economics - - Trade
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • H2 - Public Economics - - Taxation, Subsidies, and Revenue

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