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on International Activities of Firms |
| By: | Amodio, Francesco; Chiovelli, Giorgio; Frache, Serafin |
| Abstract: | We show that commodity export booms can propagate up the value chain, reshape production networks, and promote growth in the service sector. We study Uruguay’s beef export boom to China in the 2010s, combining customs, firm-to-firm transactions, employer-employee, and balance sheet data. Firms more linked to exporters experienced higher sales, especially in services, with associated gains in employment, wages, and sales per worker. Aggregate sales rose by 1.79%, with each export dollar generating 46 more cents in domestic sales, 10 cents in services. Over time, service firms reoriented their connections toward beef exporters, amplifying their gains from trade. |
| Keywords: | Commodity exports; Production network; Services; China shock |
| JEL: | F14 L14 O14 O54 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20078 |
| By: | Andreas MOXNES; Yukiko SAITO |
| Abstract: | Follow FDI refers to the phenomenon whereby a supplier of a multinational firm establishes foreign affiliates in the same countries as their multinational customer, effectively replicating the supply chain abroad. Using novel Japanese data, we show that roughly one third of local affiliate sales (and purchases) are to other Japanese affiliates operating in the same country, indicating that a substantial share of multinational activity takes place within replicated domestic supply chains. Event studies confirm that when a firm starts selling to a multinational in Japan, the supplier is more likely to become a multinational itself. Our findings provide new micro-level evidence on how domestic value chains shape global value chains and the geography of globalization. The results highlight (i) the importance of domestic production networks in mediating access to international markets and (ii) a novel channel through which multinational activity spills over to domestic suppliers. These findings broaden and enhance our understanding of (i) why firms become multinationals, (ii) the dynamics of affiliate sales and (iii) the potential spillover effects of multinational activity. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:eti:dpaper:26055 |
| By: | Conconi, Paola; Leone, Fabrizio; Magerman, Glenn; Thomas, Catherine |
| Abstract: | We provide a novel explanation for the dominance of multinational corporations (MNCs) in international trade: MNC affiliates face lower trade frictions in countries that belong to their parental network. Combining rich administrative data from Belgium with data on MNCs’ global affiliate networks, we estimate event studies in a three-dimensional panel with staggered treatment effects, exploiting variation within multinational affiliates in their ownership status and across affiliates in the geographical structure of their parental network. We show that firms acquired by an MNC are more likely to start exporting to and importing from countries that belong—or that are exogenously added—to their parental network. We provide evidence suggesting that the effects increase with knowledge flows within the MNC hierarchy and extend beyond the boundaries of the multinational. In a model of firms’ export and import choices, firm-country-year-level gravity regressions isolate “MNC network effects†from other channels through which multinational ownership can affect firms’ trade participation. Combining the structure of the model with our empirical estimates, we find that MNC network effects have a large impact on new affiliates’ sales and employment growth. |
| Keywords: | Multinational companies; Production networks |
| JEL: | F10 F23 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:20014 |
| By: | Pablo Filippi; Ryan Kim; Ms. Nan Li; María Jesús Pérez; Younghun Shim |
| Abstract: | We study how commodity booms affect productivity using administrative microdata from Chile combining firm exports by product and destination, employer-employee records, and firm-to-firm production networks. Exploiting differential Chinese demand across Chilean commodity products, we measure firms’ exposure to the boom and trace its effects on productivity and resource allocation. We find three mechanisms. First, more exposed firms experience larger revenue increases but no differential productivity gains, channeling revenues into wages and materials. Second, among exposed firms, low-productivity firms expand employment while high-productivity firms do not, hiring workers from more productive employers. Third, domestic suppliers with greater indirect exposure show larger sales and productivity gains. We develop a model with heterogeneous export wedges and labor market frictions in which commodity booms can reduce sectoral productivity by exacerbating input misallocation, consistent with firm-level and aggregate evidence. Calibrated to Chile, this mechanism explains half of the mining TFP decline from 2005 to 2013. |
| Keywords: | Commodity booms; Misallocation; Productivity; Micro-level Data; Labor reallocation. |
| Date: | 2026–07–31 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2026/163 |
| By: | Andrew B. Bernard; Teresa Fort; Valerie Smeets; Frederic Warzynski |
| Abstract: | This paper uses a unique offshoring survey to show that firms import the same goods they manufacture at home after they relocate production to low-wage countries. Instead of ceasing domestic production, offshorers produce higher-priced domestic varieties and increase both the shares and levels of their employment in innovation-related occupations. These responses highlight an under-explored aspect of globalization: the opportunity to offshore production of low-end varieties and focus domestic activities on the development, production, and marketing of high-quality or technologically advanced versions. |
| Keywords: | globalization, offshoring, reorganization |
| JEL: | L25 F14 F61 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_12820 |