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The buyer margins of firms' exports

Jeronimo Carballo, Gianmarco Ottaviano () and Christian Volpe Martincus

Journal of International Economics, 2018, vol. 112, issue C, 33-49

Abstract: We use detailed data on exporters from Costa Rica, Ecuador and Uruguay as well as on their buyers to show that: aggregate exports are disproportionally driven by few multi-buyers exporters; and each multi-buyer exporter's foreign sales of any product in a given destination are in turn accounted for by a dominant buyer. We propose an analytically solvable multi-country model of endogenous selection in which dominant exporters, dominant products and dominant buyers emerge in parallel as multi-product sellers with heterogeneous technologies compete for buyers with heterogeneous needs. The model not only provides an explanation of the existence of dominant buyers but also makes specific predictions on how the relative importance of dominant buyers should vary across export destinations depending on their market size and accessibility. We show that these predictions are borne out by our data and discuss their welfare implications in terms of gains from trade.

Keywords: Firm heterogeneity; Taste heterogeneity; Import-export relations; Competition; Selection (search for similar items in EconPapers)
JEL-codes: F12 F14 (search for similar items in EconPapers)
Date: 2018
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Related works:
Working Paper: The buyer margins of firms' exports (2016) Downloads
Working Paper: The Buyer Margins of Firms' Exports (2013) Downloads
Working Paper: The Buyer Margins of Firms' Exports (2013) Downloads
Working Paper: The buyer margins of firms' exports (2013) Downloads
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