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Trade crisis?: what trade crisis?

Author

Listed:
  • Behrens, Kristian
  • Corcos, Gregory
  • Mion, Giordano
Abstract
We investigate the dramatic 2008–2009 trade collapse using microdata from a small open economy, Belgium. Belgian trade essentially fell because of reduced quantities and unit prices, rather than fewer firms involved in international transactions, fewer trading partners per firm, or fewer products traded. Our difference-in-difference results point to a fall in the demand for tradables – especially durables and capital goods – as the main driver of the recent collapse. Finance and involvement in global value chains played only minor roles. Firm-level exports-to-turnover and imports-to-intermediates – as well as exports-to-production and imports-to-production – ratios reveal a comparable collapse of domestic and cross-border operations. Access to credit affected both types of activities to the same extent. Overall, our results point to a general fall in demand and not a crisis of Belgian cross-border trade per se.

Suggested Citation

  • Behrens, Kristian & Corcos, Gregory & Mion, Giordano, 2013. "Trade crisis?: what trade crisis?," LSE Research Online Documents on Economics 42664, London School of Economics and Political Science, LSE Library.
    • Handle: RePEc:ehl:lserod:42664
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    File URL: http://eprints.lse.ac.uk/42664/
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    2008–2009 trade collapse; trade crisis; margins of trade; firm-level analysis; Belgium;
    All these keywords.

    JEL classification:

    • F01 - International Economics - - General - - - Global Outlook
    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

    NEP fields

    This paper has been announced in the following NEP Reports:

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