2010/19 | LEM Working Paper Series | |
Intermediaries in International Trade: direct versus indirect modes of export |
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Andrew B. Bernard, Marco Grazzi, Chiara Tomasi |
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Keywords | ||
heterogeneous firms, international trade, intermediation, wholesalers
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JEL Classifications | ||
D22, F14, L22, L23
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Abstract | ||
This paper contributes to the relatively new literature on the role of intermediaries in international
trade. Using Italian firm-level data, we document significant differences between exporters of different
types and highlight the role of country-specific fixed cost in the choice of direct versus indirect modes
of export. Recent theoretical work suggests that intermediaries are typically providing solutions to
country-specific fixed costs. Our empirical results largely confirm this relationship. Measures of
country fixed costs are positively associated with intermediary exports both in the aggregate and
within firms. In contrast, proxies for variable trade costs are largely not correlated with differences
between direct and indirect exports.
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