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Deep Trade Agreements and Heterogeneous Firms Exports

Author

Listed:
  • Gianluca Orefice

    (CEPII - Centre d'Etudes Prospectives et d'Informations Internationales - Centre d'analyse stratégique, LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique)

  • Matteo Neri Lainé

    (LEDa - Laboratoire d'Economie de Dauphine - IRD - Institut de Recherche pour le Développement - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique)

  • M. Ruta

Abstract

This paper studies the effect of regional trade agreements on firms' exports. Using detailed information on the content of trade agreements and firm-level exports for 31 developing countries between 2000 and 2020, the analysis shows that the depth of trade agreements matters for the export performance of firms. Moving from shallow to deep trade agreements boosts firms' exports, on average, by 3.6 percent. In line with models of trade with heterogeneous firms, the trade impact of deep trade agreements depends on firm's characteristics. The impact is stronger for large firms and firms involved in global value chains and is negative for small firms. Robustness tests and an Instrumental Variable strategy confirm the causal interpretation of the results. These heterogeneous impacts on firms' exports imply a selection effect of deep trade agreements with significant welfare consequences.

Suggested Citation

  • Gianluca Orefice & Matteo Neri Lainé & M. Ruta, 2024. "Deep Trade Agreements and Heterogeneous Firms Exports," Working Papers hal-04743292, HAL.
    • Handle: RePEc:hal:wpaper:hal-04743292
    Note: View the original document on HAL open archive server: https://hal.science/hal-04743292v1
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    Cited by:

    1. is not listed on IDEAS
    2. Atsuyuki KATO & Hiroyuki NISHIYAMA, 2025. "Supply Chains and FTAs," Discussion papers 25068, Research Institute of Economy, Trade and Industry (RIETI).
    3. Krishna, Kala & Salamanca, Carlos & Suzuki, Yuta & Volpe Martincus, Christian, 2025. "Learning to use trade agreements," Journal of Development Economics, Elsevier, vol. 174(C).

    More about this item

    Keywords

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    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

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