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The impact of firms’ international trade on domestic suppliers: The case of Japan

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  • Endoh, Masahiro

Abstract

This study revisits the propagation of trade effects through inter-firm transactions with upstream domestic firms on five types of business indices. It uses Japanese buyer–seller relationship data constructed by applying more suitable criteria for sampling firms. The results show that upstream manufacturing firms lower the probability of closing by selling their products to downstream manufacturing firms which increase their exports or imports. Interestingly, few unfavorable outcomes of indirect trade shocks were observed. These findings suggest that the economic impact of firms’ international trade on upstream suppliers is more nuanced than just a substitute or complement between international and domestic trade.

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  • Endoh, Masahiro, 2022. "The impact of firms’ international trade on domestic suppliers: The case of Japan," Journal of the Japanese and International Economies, Elsevier, vol. 63(C).
    • Handle: RePEc:eee:jjieco:v:63:y:2022:i:c:s0889158321000678
    DOI: 10.1016/j.jjie.2021.101188
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    More about this item

    Keywords

    Buyer–seller network; Closure; Trade;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F61 - International Economics - - Economic Impacts of Globalization - - - Microeconomic Impacts
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation

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