U.S. Banking Integration and State-Level Exports

Michalski, Tomasz Kamil; Ors, Evren

doi:10.2139/ssrn.2527182

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U.S. Banking Integration and State-Level Exports

HEC Paris Research Paper No. FIN-2014-1066

30 Pages Posted: 20 Nov 2014 Last revised: 16 Sep 2017

See all articles by Tomasz Kamil Michalski

Tomasz Kamil Michalski

HEC Paris - Economics & Decision Sciences

Evren Ors

HEC Paris - Finance Department

Date Written: September 14, 2014

Abstract

We use US interstate banking deregulations to identify the bank finance-trade channel while controlling for state-country bank links. A 1% increase in banking integration between states caused a 0.23% increase in the state-country level foreign exports/domestic shipments ratio between 1992-1996. The observed effect is due to banks with foreign assets, while the US expansion of banks with only domestic assets has no impact on exports/domestic shipments ratio. Our findings support the bank finance channel of international trade.

Keywords: exports, international trade, interstate banking deregulation

JEL Classification: F10, F15, G21, G28

Suggested Citation: Suggested Citation

Michalski, Tomasz K. and Ors, Evren, U.S. Banking Integration and State-Level Exports (September 14, 2014). HEC Paris Research Paper No. FIN-2014-1066, Available at SSRN: https://ssrn.com/abstract=2527182 or http://dx.doi.org/10.2139/ssrn.2527182