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COVID-19 vs. GFC: A firm-level trade margins analysis using Kenyan data

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  • Majune, Socrates Kraido
  • Türkcan, Kemal

Abstract

This study describes trade margins (intensive and extensive) and establishes determinants of the mid-point export and import growth during the global financial crisis (GFC) and COVID-19 pandemic by relying on Kenya's monthly customs transaction data (at 6-digit level of Harmonized System) for the period January 2006-June 2020. Exports fell during the two crises, of which the intensive margin was responsible for the drop during GFC while the extensive margin dominated the COVID-19 era. Imports are mainly driven by the extensive margin which grew during GFCbut declined during the pandemic. However, the fall in the intensive and extensive margins was near symmetrical during the pandemic. Estimates from the fixed-effects regression model reveal that the decrease in export and import mid-point growth was larger during the COVID-19 pandemic than GFC and it was determined by several factors: firm-, product- and partner-country characteristics. Overall, addressing both supply- and demand-side shocks can help countries adjust better to future crises.

Suggested Citation

  • Majune, Socrates Kraido & Türkcan, Kemal, 2022. "COVID-19 vs. GFC: A firm-level trade margins analysis using Kenyan data," WTO Staff Working Papers ERSD-2022-6, World Trade Organization (WTO), Economic Research and Statistics Division.
    • Handle: RePEc:zbw:wtowps:ersd20226
    DOI: 10.30875/25189808-2022-6
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    References listed on IDEAS

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    1. Joachim Wagner, 2016. "A survey of empirical studies using transaction level data on exports and imports," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 152(1), pages 215-225, February.
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    More about this item

    Keywords

    trade margins; mid-point growth; GFC; COVID-19; Kenya;
    All these keywords.

    JEL classification:

    • F02 - International Economics - - General - - - International Economic Order and Integration
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • F60 - International Economics - - Economic Impacts of Globalization - - - General
    • G01 - Financial Economics - - General - - - Financial Crises

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