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Relationship Stickiness, International Trade, and Economic Uncertainty

Author

Listed:
  • Julien Martin

    (UQAM - Université du Québec à Montréal = University of Québec in Montréal, CEPR - U 1100 - Centre d’Etude des Pathologies Respiratoires [Tours] - UT - Université de Tours - INSERM - Institut National de la Santé et de la Recherche Médicale)

  • Isabelle Mejean

    (ECON - Département d'économie (Sciences Po) - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, CEPR - U 1100 - Centre d’Etude des Pathologies Respiratoires [Tours] - UT - Université de Tours - INSERM - Institut National de la Santé et de la Recherche Médicale)

  • Mathieu Parenti

    (ULB - Université libre de Bruxelles = Free University of Brussels, CEPR - U 1100 - Centre d’Etude des Pathologies Respiratoires [Tours] - UT - Université de Tours - INSERM - Institut National de la Santé et de la Recherche Médicale, ECARES - European Center for Advanced Research in Economics and Statistics - ULB - Université libre de Bruxelles = Free University of Brussels, UNI - ULB Neuroscience Institute [Brussels] - ULB - Université libre de Bruxelles = Free University of Brussels)

Abstract

We study how stickiness in business relationships influences the trade impact of aggregate uncertainty. To begin, we construct a product-level index of relationship stickiness using firm-to-firm relationship duration data. We then demonstrate how relationship stickiness shapes trade dynamics in response to uncertainty shocks. We find that episodes of uncertainty lead to a decline in the overall establishment of new business relationships, with the impact varying depending on the level of stickiness. In markets characterized by high stickiness, uncertainty shocks primarily impede investments in new firm-to-firm relationships. In contrast, for non-sticky products, the adjustment to uncertainty shocks mainly manifests as the disruption of existing relationships.

Suggested Citation

  • Julien Martin & Isabelle Mejean & Mathieu Parenti, 2026. "Relationship Stickiness, International Trade, and Economic Uncertainty," Sciences Po Economics Publications (main) hal-04516313, HAL.
    • Handle: RePEc:hal:spmain:hal-04516313
    DOI: 10.1162/rest_a_01396
    Note: View the original document on HAL open archive server: https://sciencespo.hal.science/hal-04516313v1
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    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F44 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Business Cycles
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis

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