Intranational Home Bias: Some Explanations

Russell Hillberry and David Hummels

The Review of Economics and Statistics, 2003, vol. 85, issue 4, 1089-1092

Abstract: Wolf demonstrates that trade within the United States appears substantially impeded by state borders. We revisit this finding with improved data. We show that much intranational home bias can be explained by wholesaling activity. Shipments by wholesalers are much more localized within states than shipments from manufacturing establishments. Controlling for relative prices and the use of actual, rather than imputed, shipment distances also reduces home bias estimates. © 2003 President and Fellows of Harvard College and the Massachusetts Institute of Technology.

Date: 2003
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Working Paper: Intra-national Home Bias: Some Explanations (2002)
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