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Service Traders in the UK

Author

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  • Holger Breinlich
  • Chiara Criscuolo

Abstract

We provide a novel set of stylized facts on firms engaging in international trade in services, using unique firm-level data on services exports and imports in the United Kingdom in 2000- 2005. Less than 10% of firms trade in services but they can be found in all sectors of the UK economy. While the services sector accounts for 80% of total exports and imports, the frequency and trade intensity of services traders is often higher in sectors such as high- tech manufacturing. Services traders are bigger, more productive and are more likely to be foreign owned or part of a multinational enterprise. These 'trade premia' are smaller then for goods traders, however, with the exception of skill intensity which is higher among services traders. There are also significant differences between exporters and importers of services. Furthermore, we show that most firms only export or import a single service type and trade with a small number of countries. Trade volume, employment, turnover and value added are highly concentrated among a small group of firms trading with many countries and/or in many services types. These firms are characterised by bigger size and higher than average productivity, all of which seem to be principally correlated with more trade along the intensive margin (trade per services and country) .although there are a number of noteworthy exceptions. Interestingly, trade is also concentrated within .rms. The top export and import destination make up 70% of the average firm's total trade and the top services type around 90%. This strong concentration is still present among firms trading with many countries and/or in many products.

Suggested Citation

  • Holger Breinlich & Chiara Criscuolo, 2008. "Service Traders in the UK," CEP Discussion Papers dp0901, Centre for Economic Performance, LSE.
  • Handle: RePEc:cep:cepdps:dp0901
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Joseph Francois & Bernard Hoekman, 2010. "Services Trade and Policy," Journal of Economic Literature, American Economic Association, vol. 48(3), pages 642-692, September.
    2. Miroudot, Sébastien & Sauvage, Jehan & Shepherd, Ben, 2013. "Measuring the cost of international trade in services," World Trade Review, Cambridge University Press, vol. 12(04), pages 719-735, October.
    3. Chiara Criscuolo & Luis Garicano, 2010. "Offshoring and Wage Inequality: Using Occupational Licensing as a Shifter of Offshoring Costs," American Economic Review, American Economic Association, vol. 100(2), pages 439-443, May.

    More about this item

    Keywords

    International trade; services; firm-level evidence;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F19 - International Economics - - Trade - - - Other
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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