Importing, Exporting and Firm-Level Employment Volatility

40 Pages Posted: 6 Nov 2013

See all articles by Christopher Johann Kurz

Christopher Johann Kurz

Board of Governors of the Federal Reserve System

Mine Zeynep Senses

Johns Hopkins University - SAIS

Multiple version iconThere are 3 versions of this paper

Date Written: October 30, 2013

Abstract

In this paper, we use detailed trade and transactions data for the U.S. manufacturing sector to empirically analyze the direction and magnitude of the association between firm-level exposure to trade and the volatility of employment growth. We find that, relative to purely domestic firms, firms that only export and firms that both export and import are less volatile, whereas firms that only import are more volatile. The positive relationship between importing and volatility is driven mainly by firms that switch in and out of importing. We also document a significant degree of heterogeneity across trading firms in terms of the duration of time and intensity with which firms trade, the number and type of products they trade and the number and characteristics of their trading partners. We find these factors to play an important role in explaining the differential impact of trading on employment volatility experienced by these firms.

Keywords: trade, firm heterogeneity, employment volatility

JEL Classification: F1, F16, L25, L60

Suggested Citation

Kurz, Christopher Johann and Senses, Mine Zeynep, Importing, Exporting and Firm-Level Employment Volatility (October 30, 2013). FEDS Working Paper No. 2013-44, Available at SSRN: https://ssrn.com/abstract=2347481 or http://dx.doi.org/10.2139/ssrn.2347481

Christopher Johann Kurz (Contact Author)

Board of Governors of the Federal Reserve System ( email )

20th Street and Constitution Avenue NW
Washington, DC 20551

Mine Zeynep Senses

Johns Hopkins University - SAIS ( email )

1740 Massachusetts Avenue, NW
Washington, DC 20036-1984
United States
202-663-5687 (Phone)
202-663-7718 (Fax)

HOME PAGE: http://www.sais-jhu.edu/faculty/senses

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