Market-specific cost shocks and firm export behaviour

Economics

Speaker:Meredith Crowley, University of Cambridge
Date: Wednesday 19 March 2014
Time: 16.00
Location: Matrix Lecture Theatre, Building One

Further details

We examine the export behaviour of Chinese firms in the face of market-specific trade cost shocks that arise when importers impose temporary trade barriers (TTBs) - antidumping duties, safeguard tariff s, countervailing duties and China-specific safeguard tariffs - against specific products originating from China. This empirical project uses detailed data on trade policy changes from the World Bank's ``Temporary Trade Barriers Database" and trade transaction data from China's General Administration of Customs for the universe of Chinese exporting firms. We examine the following: (1) changes in the value of firm-level exports of product h to markets j in response to changes in the ad valorem cost of exporting product h to markets j, (2) changes in the volume of firm-level exports of product h to markets j in response to trade cost shocks and (3) changes in the prices of product h in markets j. Our rich dataset of trade cost shocks encompasses not only direct increases in the cost of exporting for Chinese firms to a market j but also increases in the cost of exporting for non-Chinese (e.g. EU, Indian, Korean..) firms to a market j that allows us to assess how relative changes in trade costs across countries can affect firm sales and pricing decisions.