The Euro and the Intensive and Extensive Margins of Trade: Evidence from French Firm Level Data

40 Pages Posted: 4 Aug 2008

See all articles by Antoine Berthou

Antoine Berthou

Université Paris I Panthéon-Sorbonne - Centre Maison des Sciences Economiques; Paris School of Economics (PSE)

Lionel Fontagne

University of Paris 1 Panthéon Sorbonne; Paris School of Economics; CEPII

Date Written: April 1, 2008

Abstract

We improve the study of the effects of a Currency Union on trade. Using data on French exports at the firm level, we compute an intensive and extensive margins of French exports - with a variety dimension - over the period 1998-2003. Estimation results indicate that nominal exchange rate volatility has a negative effect, which translates into the intensive and extensive margins. We also provide some evidence that the euro had an additional positive effect on the extensive margin; this effect is not related to the reduced nominal exchange rate volatility. This suggests a new varieties effect of the euro.

Keywords: trade, export margins, euro

JEL Classification: F15

Suggested Citation

Berthou, Antoine and Fontagne, Lionel, The Euro and the Intensive and Extensive Margins of Trade: Evidence from French Firm Level Data (April 1, 2008). Available at SSRN: https://ssrn.com/abstract=1194963 or http://dx.doi.org/10.2139/ssrn.1194963

Antoine Berthou

Université Paris I Panthéon-Sorbonne - Centre Maison des Sciences Economiques ( email )

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Paris Cedex 13, 75647
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Paris School of Economics (PSE) ( email )

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Paris, 75014 75014
France

Lionel Fontagne (Contact Author)

University of Paris 1 Panthéon Sorbonne ( email )

Maison des Sciences Economiques
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Paris, 75013
France
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+33 1 53 68 55 01 (Fax)

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Paris School of Economics ( email )

48 Boulevard Jourdan
Paris, 75014 75014
France
+33 1 44 07 89 94 (Phone)

HOME PAGE: http://lionelfontagne.weebly.com/

CEPII ( email )

9 Rue Georges Pitard
Paris, 75015
France
+33 1 53 68 55 06 (Phone)

HOME PAGE: http://lionelfontagne.weebly.com/

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