Speaker: Daria Taglioni, European Central Bank
(Joint with Jean-Charles Bricongne, Lionel Fontagne, Guillaume Gaulier, Vincent Vicard)
Abstract: Global trade contracted quickly and severely during the global crisis. This paper, using
data on French firms, shows that most of the trade collapse is accounted by the intensive
margin of large exporters but that many small exporters were forced to reduce both the
number of products exported and destinations served or to stop exporting altogether.
Small and large exporters suffered quantitatively proportional trade losses. Nonetheless,
large firms absorbed the shock mostly by downsizing the value of exports and smaller firms
by ceasing trade relationships. The differential impact of the trade collapse on firms also
had a distinct sectoral dimension, with firms exporting intermediate and equipment goods
suffering the worst losses. Finally, we find clear econometric evidence that the impact was
greatest for financially constrained firms, in particular if they were active in the sectors of
high financial dependence. These results are robust to controlling for dierences in firm
size and various determinants of the financial health of the firm.