Does the US EXIM Bank Really Promote US Exports?

Natasha Agarwal () and Zheng Wang ()

No 2016-12, Discussion Papers from University of Nottingham, GEP

Abstract: This paper investigates the impact of US Export-Import Bank (EXIM) on US exports particularly in the wake of international competition from foreign national export credit agencies (ECAs). We employ a gravity framework on a country-industry-year-level panel dataset that matches EXIM authorizations with US bilateral exports. Our results depict the general ineffectiveness of the Bank in promoting exports within and across industries. Some heterogeneities behind the general finding are also uncovered: industries other than aerospace parts and products are more likely to benefit from EXIM authorizations, and that EXIM authorizations to larger businesses seem to be more effective in encouraging exports. Furthermore, we find no evidence that explains the role of EXIM in encouraging US exports by offsetting foreign ECA competition. These results are neither affected by competing countries’ membership to the OECD Arrangement nor by the size of American firms that received EXIM support. Our results cast doubt on the ubiquitously positive claims made by the Bank and its supporters, yet also provide policy lessons for countries that are either in the inception stages of establishing their own ECAs or are now placing greater importance on ECA financing in encouraging domestic exports.

Keywords: Trade credits; EXIM; export competition; value chain (search for similar items in EconPapers)
Date: 2016
New Economics Papers: this item is included in nep-cse and nep-int
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Does the US EXIM Bank really promote US exports? (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:not:notgep:16/12

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