The dynamics of trade margins: Evidence from the European integration

Abstract

We analyze the exports trade margins dynamics for ten transition countries, both at the industry and product level, during the period of accession to the EU. We find that trade along both margins was driven by only about 1% of almost 5000 (HS 6-digit) products. Moreover, the largest intensive and extensive margin gains were mostly concentrated around the same subset of sectors. Last, we find a positive correlation between productivity growth and the extensive margin across the transition economies.

The causal effect of free trade agreements on the trade margins: Product‐level evidence from geographically distant partners

“…Indeed, 10 years after the FTAs entered into effect, exports of new goods accounted for one‐third to more than half of total export growth, implying that growth along the extensive margin was as important as the intensive margin. As a result, our findings—based on causal inference—directly strengthen those in Kehoe and Ruhl (2013) and others, such as Dalton (2014, 2017), Cho and Díaz (2018a, 2018b), del Rosal (2019) and Amarsanaa and Kurokawa (2021), who document strong correlations between the extensive margin and post‐liberalization export growth, but do not establish any causal relationships.…”

“…Since our article deals with many countries-large and small-the country-pair specific nature of the KR methodology seems to be the most appropriate one to employ. Other studies, such as Kehoe et al (2015), Dalton (2017) and Cho and Díaz (2018a) and Amarsanaa and Kurokawa (2021) share this view and use the KR methodology as well. 9 We also present those trends expressed both in constant dollars and as a fraction of the destination country's GDP in Appendix.…”

Intensive and Extensive Margins of Export Diversification as Strategies for Sustainable Economic Growth: Evidence from the Nigerian Economy

“…The results reveal that extensive margin of export appears as a complementary strategy to increase the contribution of trade to economic growth. Cho and Díaz (2018) 10 transition countries…”

“…Empirical findings, however, have been mixed and inconclusive. Although some empirical studies (Adelan & Kakinaka, 2018; Bingzhan, 2011; Bojnec et al, 2021; Ekmen-Özçelik & Erlat, 2013; Gao et al, 2014; Islam, 2014; Jongwanich, 2020; Otamurodov et al, 2016; Sun & Xian-de, 2018; Tanasritunyakul, 2021; Tianhao & Jing, 2021; Turkcan, 2014a; Veeramani et al, 2018; Zhang et al, 2017; Zhou et al, 2013) lend credence to the intensive margin proposition, several others (Aldan & Çulha, 2016; Amarsanaa & Kurokawa, 2021; Banda & Simumba, 2013; Bista & Sheridan, 2021; Cho & Díaz, 2018; Dutt et al, 2013; Huchet‐Bourdon et al, 2018; Kehoe & Ruhl, 2013; Mora & Olabisi, 2021; Rahmouni, 2020; Turkcan, 2014b; Zhao et al, 2013) also validate the extensive margin exposition.…”