Schröder, Philipp J.H.6; Trabold, H.5; Trübswetter, P.5
1 GlobID -Globalization and Industry Dynamics, Aarhus School of Business, Aarhus BSS, Aarhus University2 Department of Management, Aarhus School of Business, Aarhus BSS, Aarhus University3 International Economic Integration, Aarhus School of Business, Aarhus BSS, Aarhus University4 Department of Economics and Business Economics, Aarhus BSS, Aarhus University5 unknown6 Department of Economics and Business Economics, Aarhus BSS, Aarhus University
The paper explores the question of why trade intermediaries (TIs) are frequently used as agents for exports to some countries but not to others. First, we adapt a standard intra-industry trade model with variable export costs (e.g. transport) and fixed export costs (e.g. market access) to include a TI that is able to pool market access cost. This framework suggests explanatory factors for the TI share in a country's exports, which are largely in line with the literature. Second, we test these explanatory factors with a new data set based on French customs information. The paper finds that: (i) higher market access costs increase the TI share, (ii) smaller export markets feature a larger TI share, (iii) network effects are important determinants of trade intermediation.
Applied Economics Quarterly, 2005, Vol 51, Issue 3, p. 267-288