[go: up one dir, main page]
More Web Proxy on the site http://driver.im/
IDEAS home Printed from https://ideas.repec.org/p/cdl/ucsdec/qt1qx2x540.html
   My bibliography  Save this paper

Entrepreneurship in International Trade

Author

Listed:
  • Rauch, J E
  • Watson, Joel
Abstract
Motivated by evidence on the importance of incomplete information and networks in international trade, we investigate the supply of "network intermediation." We hypothesize that the agents who become international trade intermediaries first accumulate networks of foreign contacts while working as employees in production or sales, then become entrepreneurs who sell access to and use of the networks they accumulated. We report supportive results regarding this hypothesis from a pilot survey of international trade intermediaries. We then build a simple general-equilibrium model of this type of entrepreneurship, and use it for comparative statics and welfare analysis. One welfare conclusion is that intermediaries may have inadequate incentives to maintain or expand their networks, suggesting a rationale for the policies followed by some countries to encourage large-scale trading companies that imitate the Japanese sogo shosha.

Suggested Citation

  • Rauch, J E & Watson, Joel, 2001. "Entrepreneurship in International Trade," University of California at San Diego, Economics Working Paper Series qt1qx2x540, Department of Economics, UC San Diego.
  • Handle: RePEc:cdl:ucsdec:qt1qx2x540
    as

    Download full text from publisher

    File URL: https://www.escholarship.org/uc/item/1qx2x540.pdf;origin=repeccitec
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Portes, Richard & Rey, Helene, 2005. "The determinants of cross-border equity flows," Journal of International Economics, Elsevier, vol. 65(2), pages 269-296, March.
    2. Stahl, Dale O, II, 1988. "Bertrand Competition for Inputs and Walrasian Outcomes," American Economic Review, American Economic Association, vol. 78(1), pages 189-201, March.
    3. Rhee, Yung Whee, 1990. "The catalyst model of development: Lessons from Bangladesh's success with garment exports," World Development, Elsevier, vol. 18(2), pages 333-346, February.
    4. Rauch, James E., 1999. "Networks versus markets in international trade," Journal of International Economics, Elsevier, vol. 48(1), pages 7-35, June.
    5. Arthur J. Hosios, 1990. "On The Efficiency of Matching and Related Models of Search and Unemployment," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 57(2), pages 279-298.
    6. James E. Rauch, 2001. "Business and Social Networks in International Trade," Journal of Economic Literature, American Economic Association, vol. 39(4), pages 1177-1203, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jose Guilherme Reis & Gonzalo Varela, 2015. "Travel Channel Meets Discovery Channel or How Tourism Can Encourage Better Export Performance and Diversification in Nepal," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 16(2), pages 183-208, September.
    2. T. Huw Edwards, 2006. "Search and the Path-Dependency of Trade," Discussion Paper Series 2006_12, Department of Economics, Loughborough University, revised May 2006.
    3. Hausmann, Ricardo & Rodrik, Dani, 2003. "Economic development as self-discovery," Journal of Development Economics, Elsevier, vol. 72(2), pages 603-633, December.
    4. Feenstra Robert C & Hanson Gordon H. & Lin Songhua, 2004. "The Value of Information in International Trade: Gains to Outsourcing through Hong Kong," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 4(1), pages 1-37, August.
    5. Megbel Aleidan, 2018. "A Correlational Analysis to Assess Major Obstacles Associated with the Internationalization of Saudi Startup Enterprises," International Business Research, Canadian Center of Science and Education, vol. 11(12), pages 78-88, December.
    6. Reis, José Guilherme & Varela, Gonzalo, 2013. "Can Tourism Encourage Better Export Performance and Diversification in Nepal?," World Bank - Economic Premise, The World Bank, issue 127, pages 1-6, October.
    7. Schweinberger, A.G. & Woodland, A.D., 2015. "Entrepreneurship and conflict generating product price changes," European Economic Review, Elsevier, vol. 78(C), pages 158-174.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Krolikowski, Pawel M. & McCallum, Andrew H., 2021. "Goods-market frictions and international trade," Journal of International Economics, Elsevier, vol. 129(C).
    2. Bogang Jun & Aamena Alshamsi & Jian Gao & Cesar A Hidalgo, 2017. "Relatedness, Knowledge Diffusion, and the Evolution of Bilateral Trade," Papers 1709.05392, arXiv.org.
    3. Portes, Richard & Rey, Helene, 2005. "The determinants of cross-border equity flows," Journal of International Economics, Elsevier, vol. 65(2), pages 269-296, March.
    4. Bailey, Michael & Gupta, Abhinav & Hillenbrand, Sebastian & Kuchler, Theresa & Richmond, Robert & Stroebel, Johannes, 2021. "International trade and social connectedness," Journal of International Economics, Elsevier, vol. 129(C).
    5. Gormsen, Christian, 2009. "Intransparent Markets and Intra-Industry Trade," Working Papers 09-20, University of Aarhus, Aarhus School of Business, Department of Economics.
    6. Ariu, Andrea, 2022. "Foreign workers, product quality, and trade: Evidence from a natural experiment," Journal of International Economics, Elsevier, vol. 139(C).
    7. Noel Gaston & Douglas R. Nelson, 2013. "Bridging Trade Theory And Labour Econometrics: The Effects Of International Migration," Journal of Economic Surveys, Wiley Blackwell, vol. 27(1), pages 98-139, February.
    8. Christian Gormsen, 2012. "Intransparent Markets and Intra-Industry Trade," Post-Print halshs-00678264, HAL.
    9. Bogang Jun & Aamena Alshamsi & Jian Gao & César A. Hidalgo, 2020. "Bilateral relatedness: knowledge diffusion and the evolution of bilateral trade," Journal of Evolutionary Economics, Springer, vol. 30(2), pages 247-277, April.
    10. Lars Håkanson & Douglas Dow, 2012. "Markets and Networks in International Trade: On the Role of Distances in Globalization," Management International Review, Springer, vol. 52(6), pages 761-789, December.
    11. James E. Rauch & Joel Watson, 2004. "Network Intermediaries in International Trade," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 13(1), pages 69-93, March.
    12. Edward Anderson, 2014. "Time differences, communication and trade: longitude matters II," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(2), pages 337-369, May.
    13. Sucharita Ghosh & Donald Lien & Steven Yamarik, 2017. "Does the Confucius Institute Network Impact Cultural Distance? A Panel Data Analysis of Cross-Border Flows in and out of China," Asian Economic Journal, East Asian Economic Association, vol. 31(3), pages 299-323, September.
    14. Mariya Aleksynska & Giovanni Peri, 2014. "Isolating the Network Effect of Immigrants on Trade," The World Economy, Wiley Blackwell, vol. 37(3), pages 434-455, March.
    15. Anthony Briant & Pierre-Philippe Combes & Miren Lafourcade, 2014. "Product Complexity, Quality of Institutions and the Protrade Effect of Immigrants," The World Economy, Wiley Blackwell, vol. 37(1), pages 63-85, January.
    16. Demet Yilmazkuday & Hakan Yilmazkuday, 2017. "The role of direct flights in trade costs," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 153(2), pages 249-270, May.
    17. Yuheng Lin & Dooruj Rambaccussing & Yu Zhu, 2024. "The impact of international students in the UK on the cultural goods trade," French Stata Users' Group Meetings 2024 29, Stata Users Group.
    18. Stolowy, Hervé & Jeanjean, Thomas & Erkens, Michael, 2011. "The economic consequences of increasing the international visibility of financial reports," HEC Research Papers Series 957, HEC Paris.
    19. Badarinza, Cristian & Ramadorai, Tarun & Shimizu, Chihiro, 2022. "Gravity, counterparties, and foreign investment," Journal of Financial Economics, Elsevier, vol. 145(2), pages 132-152.
    20. James E. Rauch & Vitor Trindade, 2000. "Information and Globalization: Wage Co-Movements, Labor Demand Elasticity, and Conventional Trade Liberalization," NBER Working Papers 7671, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    international trade; network intermediation;

    JEL classification:

    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • J41 - Labor and Demographic Economics - - Particular Labor Markets - - - Labor Contracts

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cdl:ucsdec:qt1qx2x540. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Lisa Schiff (email available below). General contact details of provider: https://edirc.repec.org/data/deucsus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.