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Record W397195808

The Structure and Evolution of Entry Costs in Trade.

2013· article· en· W397195808 on OpenAlexaboutno aff
Andrew H. McCallum

Bibliographic record

VenueDeep Blue (University of Michigan) · 2013
Typearticle
Languageen
FieldEconomics, Econometrics and Finance
TopicGlobal trade and economics
Canadian institutionsnot available
Fundersnot available
KeywordsBusinessIndustrial organization
DOInot available

Abstract

fetched live from OpenAlex

The first essay addresses the structure of sunk export entry costs. Heterogeneous firm models of international trade include a country specific sunk cost that firms pay to enter a foreign market. Despite the important role these costs play in determining firm participation, we understand little about their structure. Characterizing the structure of sunk entry costs relies on careful identification of state dependence conditional on heterogeneity. I employ reduced form and structural approaches and a confidential panel of U.S. manufacturers' exporting behavior to the top 50 destinations 1992-2007 to conclude that export entry costs are mainly country specific. The structural model allows me to estimate that the global entry cost is $20 thousand while country specific entry costs are $3.7 million for Canada, $4.16 million for Japan, $3.58 million for Mexico, $4.22 million for the United Kingdom, and $3.63 million for Germany. Using confidential microdata from the U.S. Census, in the second essay we find that the fraction of manufacturing plants that export rose from 21 percent in 1987 to 39 percent in 2006. It has been suggested that similar trends in other countries may have been caused by declining costs of entering foreign markets. Our study tests this hypothesis for the first time. Both reduced form and structural estimation approaches find little evidence that entry costs facing U.S. plants declined significantly over this period. We instead argue that changes in other factors that determine export status are sufficient to explain these trends. In the third essay, we propose a framework that embeds search and matching frictions in a general equilibrium international trade model with heterogeneous firms. Search implies that the import price lies between the domestic price and the foreign affiliate's average cost of production. With no search frictions our framework recovers the standard model. Search does not affect the quantity traded, the productivity threshold associated with exporting or the domestic price. Nevertheless, search parameters enter the standard gravity equation, and the total value of imports falls as search frictions rise. We argue for the use of disaggregated data to quantify the importance of these frictions.

Fetched live from OpenAlex and de-inverted. Abstracts are not stored in this database: the inverted indexes are 8.6 GB of the frame’s 9.3 GB of text, and the host has 13 GB free.

How this classification was reachedexpand

Full frame distilled prediction

Teacher imitation

Not calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.

metaresearch head score (Codex)0.000
metaresearch head score (Gemma)0.000
Version: codex-gemma-dda1882f352aValidation status: machine_predicted_unvalidated
Candidate categoriesnone
Consensus categoriesnone
DomainCandidate signal: none · Consensus signal: none
Study designCandidate signal: Observational · Consensus signal: none
GenreCandidate signal: Empirical · Consensus signal: Empirical
Teacher disagreement score0.610
Threshold uncertainty score0.655

Codex and Gemma teacher scores by category

CategoryCodexGemma
Metaresearch0.0000.000
Meta-epidemiology (narrow)0.0000.000
Meta-epidemiology (broad)0.0000.000
Bibliometrics0.0000.000
Science and technology studies0.0000.000
Scholarly communication0.0000.000
Open science0.0000.000
Research integrity0.0000.000
Insufficient payload (model declined to judge)0.0000.000

Machine scores (provisional)

The two teacher heads of the student model, read on this work. A score orders the frame for review; it never asserts a category, and the validation status ships verbatim with every row.

Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.

Opus teacher head0.009
GPT teacher head0.140
Teacher spread0.131 · how far apart the two teachers sit on this one work
Validation statusscore_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from it

Classification

machine, unvalidated

Machine predicted; a candidate call from one teacher head, not a consensus.

The models applied no category: nothing in the taxonomy fit this work.
Study designObservational
Domainnot available
GenreEmpirical

How this classification was reached, model by model and score by score, is at the end of the page under "How this classification was reached".

Quick stats

Citations0
Published2013
Admission routes1
Has abstractyes

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