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 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.

scholarly journals Romania’s foreign trade with the European Union in 2008

2010 ◽  
Author(s):  
Ancuta Stangaciu
Keyword(s):  
European Union ◽  
International Trade ◽  
Statistical Analysis ◽  
Foreign Trade ◽  
Trade Flows ◽  
The European Union ◽  
Trade Relations ◽  
Wide Range ◽  
Trade Partners ◽  
Statistical Analysis Methods

In this study, I proposed to analyze the spatial concentration of international trade flows between Romania and the European Union both overall and by the sections of the Combined Nomenclature. Using statistical analysis methods such as square and Gini’s index or Onicescu informational energy, I concluded that Romania’s main trade partners are Italy, Germany and France and trade relations with these 3 countries are characterized by exchanges of good to cover, generally a wide range of products.

scholarly journals Practical Problems of Legal Regulation of Customs Duties Developing an International Trade Between the Republic of Lithuania And East Asian Countries

2016 ◽  
Vol 11 (2) ◽  
pp. 103-127
Author(s):  
Gediminas Valantiejus
Keyword(s):  
International Trade ◽  
Foreign Trade ◽  
East Asian ◽  
National Level ◽  
Asian Countries ◽  
Commercial Policy ◽  
Trade Relations ◽  
The Republic ◽  
Trade Partners ◽  
The Eu

Abstract For more than ten years (since 2004) the Republic of Lithuania is a member of the EU and is realizing its economic and trade relations with other foreign countries, and regulating customs duties according to the requirements of the EU Common Commercial Policy. However, in the recent years foreign trade (in particular - exports of goods) remained one of the main factors which increased an economic growth (recovery) in the Republic of Lithuania after the global economic crisis of the world, which began in 2008. In this context, the search for new markets and expansion of trade relations with new trade partners in Asia became essential in order to diversify the structure of the national economy and avoid dependence on traditional trade partners, such as Russia. Taking into account this strategic goal, the article seeks to answer a question whether an existing foreign trade regulation system ensures the status of Lithuania as an attractive partner of foreign trade with East Asian countries (Taiwan, Hong Kong, South Korea and Singapore) and what regulatory instruments (customs duty rules and procedures) should be used on the national level to ensure cooperation with these countries. In order to answer this problematic question, the first chapter of the article overviews general tendencies in Lithuanian foreign trade with the countries of East Asia, while the second chapter is dedicated to describe regulatory regime for import customs duties on the national level (in line with the major provisions of the EU Common Commercial Policy). The practical problems and obstacles to international trade are presented in the third chapter and are illustrated by the examples of case law, which was formed in disputes relating to the decisions and actions of Lithuanian national customs authorities for the period from 1 May, 2004 (since entry to the EU)).

scholarly journals The role of factoring in international trade financing

2020 ◽  
Vol 3 ◽  
pp. 36-41
Author(s):  
Tural Alasgarli ◽  
Keyword(s):  
International Economic ◽  
International Trade ◽  
Foreign Trade ◽  
Economic System ◽  
20Th Century ◽  
Trade Finance ◽  
Trade Relations ◽  
Trade Financing

As 20th century ends, international economic system has gained new characteristics, international trade and its finance has reached at a different aspect. Parallel to the increasing trade relations, new technics of foreign trade finance has been widely available. Among them, factoring was evaluated in this study.

Strategies of International Trade

2018 ◽  
pp. 381-414
Author(s):  
Alain Bresson
Keyword(s):  
International Trade ◽  
Foreign Trade ◽  
Food Production ◽  
Ancient Greece ◽  
International Market ◽  
Institutional Logics ◽  
Mutual Trade ◽  
Grain Trade ◽  
Trade Partners

This chapter examines the strategies employed in international trade in ancient Greece. It explains how the rules of trade and the distribution of “natural advantages” played the role of a system of constraints within which genuine strategies of foreign trade could be constructed. To better understand the specificity of these trade strategies, the chapter first considers the two institutional logics that prevailed in the international market: the first consisted in setting up a “surpluses for surpluses” trade strategy; the second allowed trade partners to act freely. The notions of mutual trade and nondirectional trade are discussed, along with the case of grain. The chapter also looks at the strategies used by cities to control grain trade, such as laws prohibiting grain exports, before concluding with an analysis of the grain policy of Athens as well as food production and supply in Aegean cities.

China's Geostrategic Approach to Trade in Pursuit of Global Centrality

2021 ◽  
pp. 148-175
Author(s):  
Guy-Maurille Massamba
Keyword(s):  
International Trade ◽  
National Character ◽  
Global Trade ◽  
Trade Expansion ◽  
Trade Network ◽  
Central Node ◽  
Global Power ◽  
Trade Partners ◽  
International Trade Network

The geostrategic approach refers to China's method to rise as global power through worldwide trade expansion and the development of its military and naval capabilities. It creates clusters of countries interlinked as China's trade partners, thus being assets to its global ascent. China's importance in global trade is a function of its partners' behavior embracing its trade mechanism. The edges connecting nodes are multidirectional, implying that countries are as much interested in their China-induced interlinkages as they are in their partnership with China. This results in China's centrality, a quality gained from being dominant in trade partnerships in terms of numbers and significance. This chapter examines the approach, process, and historical, geographic, and behavioral components that China uses in its ascent as central node in the international trade network. It explores how underlying dimensions making China's national character conjointly devise its behavior in global trade.

Tools for Protecting Agri-Food Markets in Trade Unions

2020 ◽  
pp. 29-34
Author(s):  
E.Yu. Frolova ◽  
Keyword(s):  
International Trade ◽  
Foreign Trade ◽  
Russian Federation ◽  
Trade Unions ◽  
International Markets ◽  
Food Markets ◽  
International Policy ◽  
Trade Relations ◽  
Regulatory Measures ◽  
The Russian Federation

Regulation of international trade relations is an essential part of international policy. The article provides a classification and describes the features of the main trade and economic unions of countries, analyzes measures and tools for organizing international trade and protecting domestic agri-food markets of countries that are members of these unions, and also reveals the principles on which their work is based. We consider the effect of certain regulatory measures for countries where food exports or imports play a significant role in their economy. Examples are given of situations in which countries or unions decide to use certain tools. The example of the Russian Federation shows how the use of tools for regulating foreign trade operations affects the domestic market and describes the obstacles that Russian food exporters may face when entering international markets.

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.

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 Export Margins, Price and Quantity of Belarus’s Export Growth

2017 ◽  
Vol 17 (1) ◽  
pp. 81-99
Author(s):  
Shavkat Otamurodov ◽  
Shujin Zhu ◽  
Ihtisham ul Haq ◽  
Tenglong Zhong
Keyword(s):  
New Products ◽  
Export Growth ◽  
Extensive Margin ◽  
Intermediate Goods ◽  
Restricted Range ◽  
Policy Makers ◽  
Extensive And Intensive Margins ◽  
Wide Range ◽  
Export Margins ◽  
Export Shares

Abstract This paper examines the sources of Belarus’s export growth and decomposes export growth into extensive and intensive margins. This study also aims to determine export margins for intermediate and final goods and to determine the price and quantity components of the intensive export margin. In order to achieve the desired objectives, we use two methods for decomposing export growth, the count method and the export shares method. We analyse Belarus's export growth using export data at the HS-6 digit level for the 2004-2014 period. Our results show that Belarus's exports grew mainly due to growth in the price margin during the studied period 2004-2014. However, the extensive margin was important in export growth to some extent. Comparing the growth rate across final and intermediate goods reveals that although the share of final products in Belarus’s exports is not very big (18.9% in 2014), the average annual growth in exports of final products is higher than that of intermediate goods. Our investigation also shows that Belarus produces a wide range of commodities, but the share of the most of these commodities is not large; its exports depend on a restricted range of commodities. Moreover, most of the commodities are exported to Russia and Ukraine. Our results give us reason to assume that finding new markets for their new products is one of the main challenges for developing countries wishing to increase their exports by an extensive margin. This has important implications for how policy makers promote the trade and diversification of exports.

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