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Costly information and rational inattention by exporters

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  • Silvia Bertarelli

    (Università degli studi di Ferrara)

Abstract

In this paper, I present a structural gravity model within a framework that considers the cost of acquiring information. This yields a structural gravity equation that incorporates an additional factor related to export dispersion. Aggregated firm-level data from a large sample of countries provides empirical evidence that dispersion influences bilateral trade flows. Dispersion acts as both a source of information and a risk factor that demands risk premia.

Suggested Citation

  • Silvia Bertarelli, 2025. "Costly information and rational inattention by exporters," SEEDS Working Papers 0425, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised Jun 2025.
    • Handle: RePEc:srt:wpaper:0425
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    References listed on IDEAS

    as
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    More about this item

    Keywords

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    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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