Export Decision under Risk

José De Sousa (), Anne-Célia Disdier and Carl Gaigne

No 265728, Working Papers from Institut National de la recherche Agronomique (INRA), Departement Sciences Sociales, Agriculture et Alimentation, Espace et Environnement (SAE2)

Abstract: Using firm and industry data, we unveil two empirical regularities: (i) Demand uncertainty not only reduces export probabilities but also decreases export quantities and increases export prices; (ii) The most productive exporters are more affected by higher industry-wide expenditure volatility than are the least productive exporters. We rationalize these regularities by developing a new firm-based trade model wherein managers are risk averse. Higher volatility induces the reallocation of export shares from the most to the least productive incumbents. Greater skewness of the demand distribution and/or higher trade costs weaken this effect. Our results hold for a large class of consumer utility functions.

Keywords: International; Relations/Trade (search for similar items in EconPapers)
Pages: 50
Date: 2017-12-11
New Economics Papers: this item is included in nep-bec, nep-int and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Export decision under risk (2020)
Working Paper: Export decision under risk (2020)
Working Paper: Export decision under risk (2020)
Working Paper: Export decision under risk (2020)
Working Paper: Export Decision under Risk (2019)
Working Paper: Export Decision under Risk (2019)
Working Paper: Export Decision under Risk (2017)
Working Paper: Export Decision under Risk (2016)
Working Paper: Export decision under risk (2015)
Working Paper: Export Decision under Risk (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:inrasl:265728

DOI: 10.22004/ag.econ.265728

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