Crisis averted: Cross‐market reallocation during the great trade collapse
Atle Oglend,
Frank Asche,
Hans‐Martin Straume
Abstract:This article investigates cross‐market reallocation of trade to mitigate negative effects of large economic shocks. We propose a simple measure of trade reallocation and apply it to Norwegian exports during the great trade collapse following the financial crisis in 2008–2009. The results indicate statistically significant cross‐market reallocation of trade away from markets hit hard by the crisis as measured by GDP/growth. Norwegian exports declined by 16.9% from 2008 and 2009. Without reallocation, the declin… Show more
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