We examine how many and what kind of firms ultimately rely on foreign inputs, sell to foreign markets, and are affected by trade shocks. To capture that firms can trade indirectly by buying from or selling to domestic firms that import or export, we use Belgian data with information on both domestic firm-to-firm sales and foreign trade transactions. We find that most firms use a lot of foreign inputs, but only a small number of firms show that dependence through direct imports. While direct exporters are rare, a majority of firms are indirectly exporting. In most firms, however, indirect export is quantitatively modest, and sales at home are the key source of revenue. We show that what matters for the transmission of foreign demand shocks to a firm's revenue is how much the firm ultimately sells to foreign markets, not whether these sales are from direct or indirect export.
Firms in global value chains (GVCs) are granular and exert bargaining power over the terms of trade. We show that these features are crucial to understanding the well-established variation in prices and pass-through across importers and exporters. We develop a novel theory of prices in GVCs, which tractably nests a wide range of bilateral concentration and bargaining power configurations. We test and evaluate the models predictions using a novel dataset merging transaction-level U.S. import data with balance sheet data for both U.S. importers and foreign exporters. Our pricing framework enhances traditional frameworks in the literature in accurately predicting price changes following a tariff shock. The results shed light on the role of firms in determining the tariff pass-through onto import prices.
Anodic porous alumina with an ideally ordered hole arrangement was formed on a Si substrate by nanoimprinting and subsequent anodization. In this process, the arrayed shallow dimples formed by nanoimprinting using a mold act as initiation sites of hole development during the anodization. To realize the precise transfer of the mold patterns to the Al surface during nanoimprinting, we used sputtered Al alloy film as a starting material. This is because the Al alloy with appropriate impurities as a sputtering target can suppress the crystal grain growth during sputtering and allow the formation of Al alloy films with smooth surfaces on the substrate. Dimple arrays with 100 nm intervals could be formed on the flat surface of the Al–Mg film on the Si substrate. Ideally ordered anodic porous alumina with an interpore distance of 100 nm was successfully obtained by subsequent anodization. A Co/alumina composite was also obtained by the electrodeposition of Co into the alumina holes. The obtained samples are expected to be applied to various functional devices requiring an ideally ordered structure on a substrate.
This paper presents a tractable model of endogenous production networks with fixed costs associated with the formation of links between firms. The model consists of a finite number of firm types producing differentiated products. Each firm is characterized by firm-specific parameters describing its CES production function, firm-specific domestic and foreign demand shifters, and a firm-specific set of potential suppliers and buyers. We consider versions of the model in which either the buyer or the supplier initiates the formation of links, and versions in which the production network can be cyclic or acyclic. Our main theoretical result is that the closed economy equilibrium is unique if the set of feasible networks consists only of networks that are acyclic and the buyer initiates the link formation while having full bargaining power in price negotiations with the supplier. We provide examples of multiple equilibria if the supplier initiates the link formation in both cyclic and acyclic feasible networks or if the buyer initiates the link formation in a cyclic production network. We take the acyclic production network model to Belgian data on firm-to-firm production networks and show that it approximates well the salient features of the network. The endogenous network model generates substantial churn in domestic firm-to-firm linkages in response to trade shocks. However, the endogenous network model generates only moderately different welfare changes compared to a model with fixed linkages, suggesting that exogenous production networks can approximate the welfare response to trade shocks reasonably well.
NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.
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