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Research interestsInternational Trade (primary)Economic Development, Economic History (secondary)
Job market paperGerms, Roads, and Trade: Theory and Evidence on the Value of Diversification in Global Sourcing
This paper studies the value of diversification in global sourcing in improving firms' resilience to supply chain disruptions. I build a model in which firms select into importing from countries and via customs with different efficiencies, taking into account domestic and international trade costs. The model predicts that high productivity firms are more geographically diversified in sourcing under input complementarity, which makes them more resilient to adverse shocks on the supply chain than low productivity firms. Reductions in trade costs induce firms to further diversify their sourcing strategies. I then exploit the 2003 SARS epidemic as a natural experiment to examine the resilience of Chinese manufacturing importers. Firm imports fell by 7.9% on average when the trade route was hit by SARS, but as much as 52% for firms without any diversification. The disruptions led to smaller increases in marginal cost for firms with more trade routes for imports. The epidemic reduced total Chinese manufacturing outputs by about 0.7% at its peak. Connectivity to roads increased firms' resilience to the epidemic by facilitating input diversification.
“The costs and benefits of leaving the EU: trade effects”, Economic Policy, Volume 32, Issue 92, 1 October 2017, Pages 651–705. (with S. Dhingra, G. Ottaviano, J. Pessoa, T Sampson and J. van Reenen.)
“Structural Adjustments and International Trade: Theory and Evidence from China”. (with Jiandong Ju and Vivian Yue). Under review.
"Comparative Advantage, Competition, and Firm Heterogeneity". (with Gianmarco Ottaviano). Mimeo.
Placement OfficerProfessor Wouter Den Haan
SupervisorProfessor Gianmarco Ottaviano
AdvisorsDr Thomas SampsonDr Catherine Thomas
ReferencesProfessor Robin BurgessProfessor Gianmarco OttavianoDr Thomas SampsonDr Catherine Thomas
Phone number+44 (0)74 5029 0090
Office AddressDepartment of Economics, London School of Economics and Political Science, Houghton Street, London WC2A 2AE
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