The Gains from Input Trade with Heterogeneous Importers

Firms differ substantially in their participation in foreign input markets. We develop a methodology to measure the aggregate effects of input trade that takes such heterogeneity into account. We provide a theoretical result that holds in a variety of settings: the firm-level data on value added and domestic expenditure shares in material spending is sufficient to compute the change in consumer prices due to a shock to the import environment. We characterize the bias of approaches that rely on aggregate statistics. In an application to French data, input trade reduces the prices of manufacturing products by 27 percent. (JEL D24, E31, F12, F14, L11, L25, L60)

• Publication year

  2018

• Venue

  American Economic Journal: Macroeconomics

• Publication date

  2018-10-01

• Fields of study

  Economics

• Identifiers
  DOI 10.1257/MAC.20160426
• External record

  Open on Semantic Scholar

• Source metadata

  Semantic Scholar

• No claims are published for this paper.

• No concepts are published for this paper.

• Firm Size and the Intensive Margin of Import Demand

  2017cited by this paper
• The Margins of Global Sourcing: Theory and Evidence from U.S. Firms

  2017cited by this paper
• WORKING PAPER SERIES HOW DID CHINA ’ S WTO ENTRY BENEFIT U . S . CONSUMERS ?

  2017cited by this paper
• Granular Comparative Advantage∗

  2016cited by this paper
• Prices, Markups and Trade Reform

  2016cited by this paper
• R&D, International Sourcing, and the Joint Impact on Firm Performance

  2015cited by this paper
• Identification Properties of Recent Production Function Estimators

  2015cited by this paper
• Imported Inputs and Productivity

  2015influential reference
• Importers, exporters, and exchange rate disconnect

  2014cited by this paper
• NBER WORKING PAPER SERIES TRADE, SKILLS, AND QUALITY UPGRADING: A THEORY WITH EVIDENCE FROM COLOMBIA

  2014cited by this paper
• Firm Performance in a Global Market

  2014cited by this paper
• Trade Models, Trade Elasticities, and the Gains from Trade

  2014cited by this paper
• The Margins of Global Sourcing: Theory and Evidence from U.S. Firms∗

  2013cited by this paper
• NBER WORKING PAPER SERIES TRADE ADJUSTMENT AND PRODUCTIVITY IN LARGE CRISES

  2013cited by this paper
• Trade Theory with Numbers: Quantifying the Consequences of Globalization

  2013cited by this paper
• Markups and Firm-Level Export Status

  2012cited by this paper
• Imported inputs and the gains from trade

  2012cited by this paper
• New Trade Models, Same Old Gains?

  2012influential reference
• Nber Working Paper Series Competition, Markups, and the Gains from International Trade Competition, Markups, and the Gains from International Trade

  2012influential reference
• Estimates of the Trade and Welfare Effects of NAFTA

  2012cited by this paper
• The Empirics of Firm Heterogeneity and International Trade

  2012cited by this paper
• The Elasticity of Trade: Estimates and Evidence

  2011cited by this paper
• What Determines Productivity

  2011cited by this paper
• NBER WORKING PAPER SERIES MEASURING AGGREGATE PRODUCTIVITY GROWTH USING PLANT-LEVEL DATA

  2011cited by this paper
• The World Bank

  2009cited by this paper
• Elasticity Optimism

  2009cited by this paper
• Imported Intermediate Inputs and Domestic Product Growth: Evidence from India

  2009cited by this paper
• On estimating firm-level production functions using proxy variables to control for unobservables

  2009cited by this paper
• Does the Use of Imported Intermediates Increase Productivity? Plant-Level Evidence

  2008cited by this paper
• Product Differentiation, Multi-Product Firms and Estimating the Impact of Trade Liberalization on Productivity

  2007cited by this paper
• Federal Reserve Bank of San Francisco Working Paper Series Pricing-to-market, Trade Costs, and International Relative Prices Pricing-to-market, Trade Costs, and International Relative Prices *

  2007cited by this paper
• Trade liberalization, intermediate imputs and productivity

  2005cited by this paper
• Trade Liberalization and Firm Productivity: The Case of India

  2004cited by this paper
• Federal Reserve Bank of New York Staff Reports Globalization and the Gains from Variety

  2004cited by this paper
• Estimating Production Functions Using Inputs to Control for Unobservables

  2003cited by this paper
• Technology, Geography, and Trade

  2002cited by this paper
• Trade Liberalization, Exit, and Productivity Improvements: Evidence from Chilean Plants

  2000cited by this paper
• New Product Varieties and the Measurement of International Prices

  1994cited by this paper
• The Dynamics of Productivity in the Telecommunications Equipment Industry

  1992cited by this paper
• Errors in variables in panel data

  1986cited by this paper

• Firm Resiliency: The Role of Spillovers

  2025cites this paper
• Concentration and Markups in International Trade

  2025cites this paper
• Industrial Robot Imports and Firm Innovation: A Large Language Model

  2025cites this paper
• Shock and Awe: A Theoretical Framework and Data Sources for Studying the Impact of 2025 Tariffs on Global Supply Chains

  2025cites this paper
• Nature, sector, and GVC participation of firms: empirical insights from firm-level data in selected SSA countries

  2025cites this paper
• Group-and-cut approach for dynamic programming with Fréchet-distributed quantizers

  2025cites this paper
• Positive institutional distance and developing country firms in GVCs during the COVID-19 period

  2025cites this paper
• The hidden geography of tourism firm spending: Tracking economic leakages with firm-to-firm transactions

  2025cites this paper
• The Impact of NAFTA on Prices and Competition: Evidence from Mexican Manufacturing Plants

  2025cites this paper
• Input Sourcing Under Supply Chain Risk: Evidence from U.S. Manufacturing Firms

  2025influential citation
• How does skill distribution shape comparative advantage across industries? Theory and evidence

  2025cites this paper
• Digital trade liberalization and quality upgrading: evidence from Chinese intermediate imports

  2024cites this paper
• Firm Heterogeneity and Imperfect Competition in Global Production Networks

  2024cites this paper
• Size, Geography, and GVC Participation of Firms in Nigeria and Rwanda: implications for the AfCFTA

  2024cites this paper
• When Tariffs Disrupt Global Supply Chains

  2024influential citation
• The network origins of the gains from trade

  2024cites this paper
• A Matter of Survival: Development Through Innovation

  2024cites this paper
• Global value chain participation, globalisation and sustainable development in ASEAN

  2024cites this paper
• The value of supply chain orientation in entrepreneurship: Implications for opportunity evaluation and Lean Startup

  2024cites this paper
• Deep trade agreements and agri-food global value chain integration

  2024cites this paper
• Politically Motivated Trade Protection

  2024cites this paper
• Sufficient Statistics for Measuring Forward-Looking Welfare

  2024cites this paper
• How costly are cartels?

  2024cites this paper
• Internal Migration Adjustment in Large Crises

  2024cites this paper
• Misallocation and markups: Evidence from Indian manufacturing

  2023cites this paper
• The Aggregate Importance of Intermediate Input Substitutability

  2023influential citation
• How firms accumulate inputs: Evidence from import switching

  2023cites this paper
• The Downstream Impact of Upstream Tariffs: Evidence from Investment Decisions in Supply Chains

  2023cites this paper
• Dissecting the Impact of Imports from Low-Wage Countries on Inflation

  2023cites this paper
• Trade, Technology, and Agricultural Productivity

  2023cites this paper
• Spatial Production Networks

  2023cites this paper
• Measuring the Share of Imports in Final Consumption

  2023cites this paper
• Supplier Churn and Growth: A Micro-to-Macro Analysis

  2023cites this paper
• The rise of superstar firms in the United States: The role of global sourcing

  2023cites this paper
• A Sufficient Statistics Approach for Endogenous Production Networks: Theory and Evidence from Ukraine’s War

  2023cites this paper
• 5 CHAPTER Global value chains ✩

  2022influential citation
• Global Sourcing and Multinational Activity: A Unified Approach

  2022cites this paper
• Growth Through Creation and Destruction of Supply Chains

  2022cites this paper
• Quantifying the Micro and Macro Effects of Variety Creation and Destruction

  2022influential citation
• Bribery, global value chain decisions, and institutional constraints: Evidence from a cross-country firm-level data

  2022cites this paper
• Input Prices, Productivity and Trade Dynamics: Long-run Effects of Liberalization on Chinese Paint Manufacturers

  2022cites this paper
• How the breadth and depth of import relationships affect the performance of Canadian manufacturers

  2022cites this paper
• Planes, Trains, and Co-Opetition: Evidence from China

  2022cites this paper
• The Dynamics of Global Sourcing

  2022cites this paper
• Trade Policy Uncertainty

  2022cites this paper
• The impact of COVID-19 outbreak on the Mauritian export trade: a disaggregated analysis

  2022cites this paper
• Granular Linkages, Supplier Cost Shocks&Export Performance

  2022cites this paper
• Consistency of micro- and macro-level data on global value chains: Evidence from selected European countries

  2022cites this paper
• Trade Policy and Global Sourcing: An Efficiency Rationale for Tariff Escalation

  2022cites this paper
• The gains from import variety: how much does demand matter

  2022cites this paper
• IMPORTS, EXPORTS, AND EARNINGS INEQUALITY: MEASURES OF EXPOSURE AND ESTIMATES OF INCIDENCE

  2022cites this paper
• Impacts of COVID‐19 on Global Value Chains

  2021cites this paper
• Big Push in Distorted Economies

  2021cites this paper
• Importing, Exporting, and Firms’ Productivity Evolution in China

  2021cites this paper
• Export specialization, trade liberalization and economic growth: a synthetic control analysis

  2021cites this paper
• Endogenous Spatial Production Networks: Quantitative Implications for Trade and Productivity

  2021cites this paper
• Rising markups and optimal redistributive taxation

  2021cites this paper
• The Long-Term Impact of Steel Tariffs on U.S. Manufacturing

  2021cites this paper
• Firm Heterogeneity and the Impact of Immigration: Evidence from German Establishments

  2021influential citation
• Introduction. Reaping the potential benefits of the African Continental Free Trade Area for inclusive growth

  2021cites this paper
• Trade Policy Uncertainty, Market Return, and Expected Return Predictability

  2021cites this paper
• Size, Trade, Technology and the Division of Labor

  2021cites this paper
• Production sharing and exchange rate pass-through

  2021cites this paper
• International Sourcing and Firm Learning: Evidence from Serbian Firms

  2021cites this paper
• ENDOGENOUS SPATIAL PRODUCTION NETWORKS: QUANTITATIVE IMPLICATIONS FOR TRADE AND PRODUCTIVITY

  2021cites this paper
• Trade Protection along Supply Chains ∗

  2020cites this paper
• Quality‐cum‐price sorting

  2020cites this paper
• Managing Global Production:Theory and Evidence from Just-in-Time Supply Chains

  2020cites this paper
• Micro to Macro: Optimal Trade Policy With Firm Heterogeneity

  2020cites this paper
• Markups and misallocation with evidence from exchange rate shocks

  2020influential citation
• SERIES THE REAL EXCHANGE RATE , INNOVATION AND PRODUCTIVITY : HETEROGENEITY , ASYMMETRIES AND HYSTERESIS

  2020cites this paper
• When Tari¤s Disrupt Global Supply Chains

  2020cites this paper
• Impacts of covid-19 on international trade : evidence from the first quarter of 2020

  2020influential citation
• Firm Input Choice Under Trade Policy Uncertainty

  2020cites this paper
• Global sourcing in oil markets

  2020cites this paper
• International Trade and Earnings Inequality: A New Factor Content Approach

  2020influential citation
• Globalization for Sale

  2020cites this paper
• The Gravity of Intermediate Goods

  2020cites this paper
• Organizing Global Supply Chains: Input-Output Linkages and Vertical Integration

  2020cites this paper
• Heterogeneous Globalization: Offshoring and Reorganization

  2020influential citation
• Foreign Shocks as Granular Fluctuations

  2020cites this paper
• Vertical specialisation and gains from trade

  2020cites this paper
• Volatility in the small and in the large: The lack of diversification in international trade

  2020cites this paper
• Technology-Induced Trade Shocks? Evidence from Broadband Expansion in France

  2019influential citation
• Matching and Agglomeration: Theory and Evidence From Japanese Firm‐to‐Firm Trade

  2019cites this paper
• The Gravity of Intermediate Goods ∗

  2019cites this paper
• RSCAS 2019/87 The Gravity of Intermediate Goods

  2019cites this paper
• Innovation, Growth, and Dynamic Gains from Trade

  2019cites this paper
• Firm Size , Quality Bias and Import Demand ∗

  2019influential citation
• Offshoring and skill-upgrading in French manufacturing

  2019cites this paper
• International trade and firm performance

  2018cites this paper
• Trade costs, import penetration, and markups

  2018cites this paper
• Three essays on firms and international trade

  2018influential citation
• Commodity Trade Matters

  2018cites this paper
• Subjective interest rate uncertainty and the macroeconomy: A cross-country analysis

  2018cites this paper
• A guideline to French firm-level trade data

  2018cites this paper
• Trade, Quality Upgrading, and Input Linkages: Theory and Evidence from Colombia

  2018cites this paper
• The Real Exchange Rate, Innovation and Productivity: Regional Heterogeneity, Asymmetries and Hysteresis

  2018cites this paper
• ENDOGENOUS SPATIAL PRODUCTION NETWORKS: QUANTITATIVE IMPLICATIONS FOR TRADE & PRODUCTIVITY

  2018cites this paper
• Global Firms in Large Devaluations

  2018influential citation