Importer Dynamics: Do Peers Matter?

42 Pages Posted: 24 Jan 2024

See all articles by Gregory Corcos

Gregory Corcos

Université d'Abomey-Calavi (UAC) - Ecole Polytechnique

Stefanie Haller

affiliation not provided to SSRN

Multiple version iconThere are 3 versions of this paper

Abstract

Few firms import even when formal trade barriers are low and despite substantial potential gains. Likely reasons are uncertainty and informational frictions, creating scope for local peers to affect new importers. We explore this hypothesis using data on French imports by firm-product-country-year, location, and importer characteristics. First, we study the decision to start importing as a function of the lagged number of importers in the same commuting zone (CZ), identifying off variation across country-product combinations within a firm-year. We find that the presence of such peers more than doubles the probability to start importing the same product from the same country. Second, we examine how the elimination of Multi-Fibre Agreement textile and clothing quotas affects the number of import starters at the CZ level. Here the number of import starters from quota countries increases by 40 to 90% more in commuting zones with a higher initial number of peers. Our results imply that the social returns to importing exceed its private returns.

Keywords: F14, F61, D22, Trade, import start, spillovers, Multi-Fibre Agreement

Suggested Citation

Corcos, Gregory and Haller, Stefanie, Importer Dynamics: Do Peers Matter?. Available at SSRN: https://ssrn.com/abstract=4704625 or http://dx.doi.org/10.2139/ssrn.4704625

Gregory Corcos (Contact Author)

Université d'Abomey-Calavi (UAC) - Ecole Polytechnique ( email )

Cotonou
Benin

Stefanie Haller

affiliation not provided to SSRN ( email )

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