WHAT MATTERS FOR THE EXTENSIVE AND INTENSIVE MARGINS OF INTERNATIONAL TRADE? EVIDENCE FROM KOREAN EXPORTS

2012 ◽  
Vol 57 (03) ◽  
pp. 1250018 ◽  
Author(s):  
KICHUN KANG
Keyword(s):  
International Trade ◽  
Price Index ◽  
External Environment ◽  
Export Promotion ◽  
Extensive Margin ◽  
Suggested Model ◽  
Intensive Margin ◽  
Quantity Index ◽  
Extensive And Intensive Margins ◽  
What Matters

Recently, there has been increased interest in the distinction between the extensive margin (EM) and the intensive margin (IM) of international trade. Between 1988 and 2006, the growth of the EMs and IMs of Korean exports has been diverse across its destinations. This paper links each component of the trade value (EM, IM, price index and quantity index) to factors that have been identified as trade determinants in the suggested model. This paper finds that the destination GDP, distance, tariffs, language, existence of an export promotion agency (EPA), local infrastructure and import procedures have an effect on the EMs and IMs of Korea's exports, and the effect works largely through the IM. This paper examines the external environment that shapes the contributions of each of these margins of a country's exports.

scholarly journals The Effects of Political Institutions on the Extensive and Intensive Margins of Trade

2019 ◽  
Vol 73 (4) ◽  
pp. 755-792 ◽  
Author(s):  
In Song Kim ◽  
John Londregan ◽  
Marc Ratkovic
Keyword(s):  
Political Institutions ◽  
Extensive Margin ◽  
Intensive Margin ◽  
Interpersonal Contact ◽  
Extensive And Intensive Margins ◽  
Political Networks ◽  
Block Trade ◽  
Lasso Estimator ◽  
Trade Partners ◽  
Extensive Margin Of Trade

AbstractWe present a model of political networks that integrates both the choice of trade partners (the extensive margin) and trade volumes (the intensive margin). Our model predicts that regimes secure in their survival, including democracies as well as some consolidated authoritarian regimes, will trade more on the extensive margin than vulnerable autocracies, which will block trade in products that would expand interpersonal contact among their citizens. We apply a two-stage Bayesian LASSO estimator to detailed measures of institutional features and highly disaggregated product-level trade data encompassing 131 countries over a half century. Consistent with our model, we find that (a) political institutions matter for the extensive margin of trade but not for the intensive margin and (b) the effects of political institutions on the extensive margin of trade vary across products, falling most heavily on those goods that involve extensive interpersonal contact.

CHINA'S EXPORT MARGINS AND THEIR GROWTH SOURCES: AN ANALYSIS OF EXTENSIVE MARGIN AND INTENSIVE MARGIN

2013 ◽  
Vol 58 (04) ◽  
pp. 1350029 ◽  
Author(s):  
YONG-LIANG ZHAO ◽  
DE-XUE LIU ◽  
HUA-LIN PU ◽  
ZI-HUI YANG
Keyword(s):  
Small And Medium Enterprises ◽  
Dominant Role ◽  
Extensive Margin ◽  
Intensive Margin ◽  
Industrial Countries ◽  
The Third ◽  
Extensive And Intensive Margins ◽  
Export Variety ◽  
Import And Export ◽  
Medium Enterprises

Based on the theoretical methods by Feenstra and others, this paper applies the empirical panel data of years 2000–2007 to measure the growth of China's provincial import and export for both extensive and intensive margins. Extensive margin reflecting the level of variety becomes a significant factor for China's export and is slightly higher than intensive margin. The empirical results indicate that emerging industrial countries have gradually become the important new markets for China's export variety. As for the variables affecting variety growth, trade barriers are found to play a dominant role as invisible constraints, and small and medium enterprises contribute significantly to variety growth, while foreign investment and market-oriented reforms have become the driving force. Moreover, trade variety has been identified as the third factor of economic growth, in addition to the two traditional factors (capital and labor).

The Effects of Extensive and Intensive Margins of FDI on Domestic Employment: Microeconomic Evidence from Italy

2015 ◽  
Vol 15 (4) ◽  
pp. 2079-2109 ◽  
Author(s):  
Raffaello Bronzini
Keyword(s):  
Foreign Direct Investment ◽  
Foreign Investment ◽  
Direct Investment ◽  
Positive Relationship ◽  
Extensive Margin ◽  
Matching Method ◽  
Intensive Margin ◽  
Extensive And Intensive Margins ◽  
Skill Composition ◽  
Foreign Operations

Abstract In this paper we verify whether enterprises that have started to produce abroad have reduced employment at home after the first foreign investment (extensive margin). Next, we assess whether changes in foreign employment induce changes in domestic employment for a sample of multinationals that have already established activities abroad (intensive margin). Using matching method and diff-in-diffs estimates, we find that two years after the first foreign investment domestic employment of investing firms is slightly higher than that of domestic enterprises, but mainly among those that have undertaken horizontal foreign direct investment. In multinationals that have already activated foreign operations we find a positive relationship between foreign and domestic employment. Our findings suggest that the skill composition of domestic workforce does not change neither at the extensive nor at the intensive margin of FDI.

scholarly journals The Role of Extensive and Intensive Margins in Export Growth of Turkey to Central and Eastern European Countries

2016 ◽  
Author(s):  
Gizem Akbulut
Keyword(s):  
International Trade ◽  
Growth Rates ◽  
Product Variety ◽  
Export Growth ◽  
Export Market ◽  
Added Value ◽  
The European Union ◽  
Intensive Margin ◽  
Trade Relations ◽  
Extensive And Intensive Margins

In the recent years, Central and Eastern Europe Countries-10 (CEEC-10) countries are implementing policies for developing in international trade relations and these countries are relatively small and open economies. On the other hand, they increase both provide a dynamic increase in exports and export market share, to facilitate the European Union (EU) and their activities to integrate into world trade. The purpose of this study, with CEEC-10 of Turkey’s sectoral export growth rates decomposes into extensive and intensive margins. Also intensive margin decomposes into price and quantity components. By building on the methodology pioneered by Feenstra (1994) and Hummels and Klenow (2005) and then “the decomposition of export growth rates” method developed by Bingzhan (2011). Intensive margin is the growth in products that were exported in both periods. Extensive margin is the growth in product variety or new trade partners. In the empirical part of the study were used the BACI international trade database from CEPII. The database provides the export values and quantities for Turkey to CEEC-10 at the Harmonized System’s (HS96) six-digit level over period 2006 to 2013. Foreign trade activities of countries is an important channel both to gain of international qualification and to the realization of economic growths and/ or in terms of sustainability of the current growth rates. According to results of a study, with CEEC-10 Turkey’s export is mainly explained generally by the quantity growth rather than price growth. In other words, export growth carries with the low added value product.

A Literature Survey on Extensive and Intensive Margins in International Trade

2021 ◽  
pp. 124-136
Author(s):  
Burcu Berke
Keyword(s):  
International Trade ◽  
Foreign Trade ◽  
Literature Survey ◽  
Export Growth ◽  
Global Trade ◽  
Extensive Margin ◽  
Exporting Firms ◽  
Trade Relations ◽  
Extensive And Intensive Margins ◽  
Trade Partners

Products and firms are homogeneous in traditional foreign trade theories; products show no horizontal or vertical differentiation. It is observed that growth in exports is only related to an increase in export quantity and that this is not decomposed into margins. Since Melitz's work, there has been an increase in studies that decompose the firms' heterogeneity and export growth in foreign trade into extensive and intensive margins. The concepts are addressed in the literature known as “new-new” foreign trade theories which include extensive margins, the number of exporting firms, the number of new trade partners, and the volume or variety of exported products. In brief, the growth of global trade is the result of new trade relations (extensive margin) or a rise in existing trade relations (intensive margin). As one of the rapidly developing trade theories in international economics, the main purpose of this study is to conduct a literature survey on the extensive and intensive margins of export growth.

scholarly journals Distorted Gravity: The Intensive and Extensive Margins of International Trade

2008 ◽  
Vol 98 (4) ◽  
pp. 1707-1721 ◽  
Author(s):  
Thomas Chaney
Keyword(s):  
International Trade ◽  
Simple Model ◽  
Firm Heterogeneity ◽  
Trade Flows ◽  
Elasticity Of Substitution ◽  
Extensive Margin ◽  
Trade Barriers ◽  
Intensive Margin ◽  
The Impact

By considering a model with identical firms, Krugman (1980) predicts that a higher elasticity of substitution between goods magnifies the impact of trade barriers on trade flows. In this paper, I introduce firm heterogeneity in a simple model of international trade. I prove that the extensive margin and the intensive margin are affected by the elasticity of substitution in exact opposite directions. When the distribution of productivity across firms is Pareto, the predictions of the Krugman model with representative firms are overturned: the impact of trade barriers on trade flows is dampened by the elasticity of substitution, and not magnified. (JEL F12, F13)

INVESTMENT LIBERALIZATION, CREDIT CONSTRAINTS, AND INTERNATIONAL TRADE

2021 ◽  
pp. 2150004
Author(s):  
TINGTING XIONG ◽  
HAO SUN
Keyword(s):  
International Trade ◽  
Credit Constraints ◽  
Developed Countries ◽  
Extensive Margin ◽  
Bilateral Investment Treaties ◽  
Intensive Margin ◽  
External Finance ◽  
Investment Liberalization ◽  
Manufacturing Sectors ◽  
Robust Evidence

This paper investigates the effect of bilateral investment treaties (BITs) on the extensive and intensive product margins of exports in sectors with different credit constraints. The model in this paper demonstrates that such investment liberalization increases the extensive product margin by lowering the variable costs of selling abroad, while it decreases the intensive product margin by lowering both the fixed investment costs and the variable costs. Moreover, the effects of investment liberalization are stronger in financially more vulnerable sectors. Using a detailed dataset of 190 countries and 27 manufacturing sectors from 1988 to 2006, this paper furnishes robust evidence that BITs increase the extensive margin of exports from developed countries and decrease the intensive margin of exports. It further shows that BITs decrease the intensive margin of exports from developed countries more in the sectors that are more dependent on external finance. Similarly, the intensive margin of exports from developed countries in low tangibility sectors falls by 11.81% because of BITs, while the intensive margin in high tangibility sectors is quite stable with BITs.

The Diffusion of Product Innovations

2018 ◽  
Author(s):  
Paul Stoneman ◽  
Eleonora Bartoloni ◽  
Maurizio Baussola
Keyword(s):  
Extensive Margin ◽  
Intensive Margin ◽  
Industry Sector ◽  
Product Innovations ◽  
Market Product ◽  
Principal Finding ◽  
Considerable Period

This chapter explores the patterns of adoption and use of original and new-to-market product innovations. Three levels of diffusion are identified: (i) the spreading of first use across countries (the extensive margin); (ii) the spreading of first use across users within countries (the intensive margin); and (iii) increasing intensity of use by adopters (firms or households). The principal finding is that diffusion often takes a considerable period of time, both across and within countries. Movement on the intensive margin continues for many years after diffusion on the extensive margin is completed. Intra-firm or household diffusion is also time-intensive, differs by industry sector, country, and technology, and continues even after inter-firm or household diffusion is complete. In addition, the diffusion of the production of product innovations may eventually mean that countries that were early producers are eventually replaced by countries that were late producers.

Political parties in Canada: What determines entry, exit and the duration of their lives?

2018 ◽  
Vol 26 (5) ◽  
pp. 543-554 ◽  
Author(s):  
J Stephen Ferris ◽  
Marcel-Cristian Voia
Keyword(s):  
Political Parties ◽  
Political Party ◽  
Public Funding ◽  
Hazard Model ◽  
Parametric Models ◽  
Extensive Margin ◽  
Finite Mixtures ◽  
Entry And Exit ◽  
Intensive Margin ◽  
Economic Circumstance

Two margins of political party life in Canada since Confederation (1867) are analyzed—the extensive margin involving entry and exit (together with party turnover or churning) and the intensive margin determining survival length. The results confirm many hypotheses advanced to explain entry and exit—the importance of social and religious cleavage, election institutions, and economic circumstance. More novel are the findings that public election funding and periods with larger immigration flows have reinforced established parties at the expense of entrants and smaller sized parties. The intensive margin uses a discrete hazard model with discrete finite mixtures to confirm the Duverger-type presence of two distinct long-lived political parties surrounded by a fringe of smaller parties. Both parametric and semi-parametric models concur in finding that public funding and higher immigration flows are as successful in extending the life of established parties as in discouraging entry and exit.

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