DP9036 Services Versus Goods Trade: Are They The Same?

Author(s): Andrea Ariu
Publication Date: December 2012
Keyword(s): trade dynamics, trade in goods, trade in services
JEL(s): F10, F14, L80
Programme Areas: International Trade and Regional Economics
Link to this Page: cepr.org/active/publications/discussion_papers/dp.php?dpno=9036

In this paper, we present for the first time a qualitative and quantitative comparison between trade in services and trade in goods at firm level for the same country. We focus first on static features of trade such as participation rates,, firms' characteristics, heterogeneity, concentration and trade variation. Secondly, we explore dynamic aspects focusing on entry, exit, survival and growth strategy in foreign markets. On the one hand, our results reveal qualitative similarities between services and goods trade at firm level, suggesting that heterogeneous models of trade can be a good starting point for the analysis of trade in services. On the other hand, we highlight dramatic di erences in quantitative terms and in some key characteristics that pose new challenges to current trade models.