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Are you experienced? Survival and recovery of trade relations after banking crises

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  • Beverelli, Cosimo
  • Kukenova, Madina
  • Rocha, Nadia

Abstract

Using highly disaggregated US import data from 157 countries between 1996 and 2009, we first provide evidence that banking crises negatively affect the survival of trade relations. On average, the occurrence of a banking crisis decreases the rate of survival of trade relations by 13 percent. Moreover, we find that both the size of exports and exporting experience matter for recovery of trade relations after banking crises. Sectoral financial dependence has an experience-specific effect. Relations with more experience recover faster in financially dependent sectors. There is instead no clear evidence indicating effects of size heterogeneity, neither in financially dependent sectors nor in non-financially dependent ones. The results are robust and consistent across alternative econometric models.

Suggested Citation

  • Beverelli, Cosimo & Kukenova, Madina & Rocha, Nadia, 2011. "Are you experienced? Survival and recovery of trade relations after banking crises," WTO Staff Working Papers ERSD-2011-03, World Trade Organization (WTO), Economic Research and Statistics Division.
    • Handle: RePEc:zbw:wtowps:ersd201103
    DOI: 10.30875/6e785427-en
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    References listed on IDEAS

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    Cited by:

    1. Kukenova, Madina, 2011. "Financial liberalization and allocative dfficiency of capital," Policy Research Working Paper Series 5670, The World Bank.
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    3. Oecd, 2017. "Making trade work for all," OECD Trade Policy Papers 202, OECD Publishing.

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    More about this item

    Keywords

    banking crises; financial dependence; export experience; duration models;
    All these keywords.

    JEL classification:

    • G01 - Financial Economics - - General - - - Financial Crises
    • C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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