Dissecting Trade: Firms, Industries, and Export Destinations

We examine the entry behavior of producers in different industries in different ex-port markets using a comprehensive dataset of French firms. These data reveal enormous heterogeneity, primarily within industries, in the nature of entry into different markets. Nonetheless, some striking regularities appear both across and within industries. The French data add a new dimension to an emerging empirical literature examining international trade at the level of individual producers. Andrew Bernard and J. Bradford Jensen (1995, 1999), Sofronis Clerides et al. (1998), and Bee Yan Aw et al. (2000), among others, have shown that: (i) exporters are typically in the minority; (ii) they tend to be more productive and larger; (iii) yet they usually export only a small fraction of their output. The findings that most firms do not export while those that do sell most of what they make at home suggest substantial barriers to exporting. Theories of producer export behavior have suggested either standard “iceberg ” costs, e.g., Bernard et al. (2003) or