Trade and finance

Arnold Njike arnold.njike-oya@univ-paris1.fr

This course aims to study the impact of financial constraints on international trade. It highlights the role of financial constraints in accessing export markets, examines the impact of these constraints on the behaviour of multinational firms, and studies some methods for financing international trade. The impact that these constraints may have had in the 2008 financial crisis is also analysed. 

Grading

Students are required to present in groups a paper of their choice on the topic of financial constraints in international trade. The final grade for each student will be composed of the group grade (40% of the final grade), an individual grade (60% of the final grade) which is composed of the final exam (50% of the final grade) and a course participation/attendance grade (10% of the final grade).

Syllabus

Week 1 : Financial constraints and access to export markets

Manova, K. (2013). Credit constraints, heterogeneous firms, and international trade. Review of

Economic Studies, 80(2), 711-744.

Chaney, T. (2016). Liquidity constrained exporters. Journal of Economic Dynamics and

Control, 72, 141-154.

Muûls, M. (2015). Exporters, importers and credit constraints. Journal of International

Economics, 95(2), 333-343.

Berman, N., & Héricourt, J. (2010). Financial factors and the margins of trade: Evidence from

cross-country firm-level data. Journal of Development Economics, 93(2), 206-217.

Week 2 : Financial Instruments and International Trade

Antras, P., & Foley, C. F. (2015). Poultry in motion: a study of international trade finance

practices. Journal of Political Economy, 123(4), 853-901.

Niepmann, F., & Schmidt-Eisenlohr, T. (2017). No guarantees, no trade: How banks affect

export patterns. Journal of International Economics, 108, 338-350.

Felbermayr, G. J., & Yalcin, E. (2013). Export credit guarantees and export performance: An

empirical analysis for Germany. The World Economy, 36(8), 967-999.Schmidt-Eisenlohr, T. (2013). Towards a theory of trade finance. Journal of International

Economics, 91(1), 96-112.

Week 3 : Trade Finance and the Great trade collapse

Ahn, J. (2020). A theory of domestic and international trade finance. Emerald Publishing

Limited.

Chor, D., & Manova, K. (2012). Off the cliff and back? Credit conditions and international

trade during the global financial crisis. Journal of international economics, 87(1), 117-133.

Ahn, J., Amiti, M., & Weinstein, D. E. (2011). Trade finance and the great trade

collapse. American Economic Review, 101(3), 298-302.

Amiti, M., & Weinstein, D. E. (2011). Exports and financial shocks. The Quarterly Journal of

Economics, 126(4), 1841-1877.

Levchenko, A. A., Lewis, L. T., & Tesar, L. L. (2010). The collapse of international trade during

the 2008–09 crisis: in search of the smoking gun. IMF Economic review, 58(2), 214-253.

Weeks 4, 5 and 6: Presentations (Non-exhaustive list)

Foley, C. F., & Manova, K. (2015). International Trade, Multinational Activity, and Corporate

Finance. Annual Review of Economics, 7(1), 119-146.

Manova, K., Wei, S. J., & Zhang, Z. (2015). Firm exports and multinational activity under

credit constraints. Review of Economics and Statistics, 97(3), 574-588.

Manova, K., & Yu, Z. (2016). How firms export: Processing vs. ordinary trade with financial

frictions. Journal of International Economics, 100, 120-137.

Bilir, L. K., Chor, D., & Manova, K. (2019). Host-country financial development and

multinational activity. European Economic Review, 115, 192-220.

Manova, K. (2008). Credit constraints, equity market liberalizations and international

trade. Journal of International Economics, 76(1), 33-47.

Feenstra, R. C., Li, Z., & Yu, M. (2014). Exports and credit constraints under incomplete

information: Theory and evidence from China. Review of Economics and Statistics, 96(4), 729-

744.

Iacovone, L., Ferro, E., Pereira-López, M., & Zavacka, V. (2019). Banking crises and exports:

lessons from the past. Journal of Development Economics, 138, 192-204.

Paravisini, D., Rappoport, V., Schnabl, P., & Wolfenzon, D. (2015). Dissecting the effect of

credit supply on trade: Evidence from matched credit-export data. The Review of Economic

Studies, 82(1), 333-359.

Niepmann, F., & Schmidt-Eisenlohr, T. (2017). International trade, risk and the role of

banks. Journal of International Economics, 107, 111-126.Bricongne, J. C., Fontagné, L., Gaulier, G., Taglioni, D., & Vicard, V. (2012). Firms and the

global crisis: French exports in the turmoil. Journal of international Economics, 87(1), 134-146.

Minetti, R., & Zhu, S. C. (2011). Credit constraints and firm export: Microeconomic evidence

from Italy. Journal of International Economics, 83(2), 109-125.