TY  - JOUR
AU  - Békés, Gábor
AU  - Muraközy, Balázs
TI  - Temporary trade and heterogeneous firms
JF  - JOURNAL OF INTERNATIONAL ECONOMICS
J2  - J INT ECON
VL  - 87
PY  - 2012
IS  - 2
SP  - 232
EP  - 246
PG  - 15
SN  - 0022-1996
DO  - 10.1016/j.jinteco.2011.12.007
UR  - https://m2.mtmt.hu/api/publication/1994882
ID  - 1994882
AB  - Using Hungarian firm-transaction level export data, we show that about one third of firm-destination and about one half of firm-product-destination export spells are short-lived, or temporary, each year. This is in odds with theories where comparative advantage is stable and market entry costs are sunk. We show how endogenous choice between variable and sunk cost trade technologies can explain the empirical importance and some characteristics of temporary trade. We build a model in which the likelihood of temporary trade depends on productivity and capital cost of the firm as well as well-known gravity variables of destinations. These predictions are borne out by the data; the likelihood of permanent trade, defined by a simple filter, rises with firm productivity, financial stability, proximity and GDP of destination countries. © 2012 Elsevier B.V. All rights reserved.
LA  - English
DB  - MTMT
ER  -