Review of World Economics

, Volume 153, Issue 4, pp 779–807 | Cite as

Shipment frequency of exporters and demand uncertainty

  • Gábor BékésEmail author
  • Lionel Fontagné
  • Balázs Muraközy
  • Vincent Vicard
Original Paper


This paper examines how exporting firms adapt to the uncertainty stemming from demand volatility. By using monthly customs data from France, we decompose exports into different extensive and intensive margins including two novel margins: the number of months the firms exported (frequency) and the average export value per month. We establish four empirical patterns. First, firms export less to markets with higher demand volatility. Second, this effect is mainly explained by the frequency margin. Third, volatility affects the frequency margin through two channels: indirectly through lower trade volume and directly through logistics re-optimization. In particular, our results suggest that firms send less frequent, larger shipments to more uncertain markets conditional on total exports. Fourth, the effect of demand volatility is magnified on markets with longer time-to-ship. We propose that these observations are in line with simple stochastic inventory management approaches.


Gravity Transport costs Frequency of trade Inventory model Firms 

JEL Classification

D40 F14 R41 



We thank Zsuzsa Holler and Boldizsár Juhász for excellent research assistance provided. For comments and suggestions, we are grateful to Carlo Altomonte, Colin Cameron, Jonathan Eaton, Miklos Koren, Thierry Mayer, Adam Szeidl and seminar participants at UC Davis, CEU (Budapest), LMU (Munich), ETH (Zurich), PSE and Sciences Po (Paris), Banque de France (Paris), EEA, ETSG. The authors gratefully acknowledge financial assistance from the European Firms in a Global Economy: Internal policies for external competitiveness (EFIGE), a collaborative project funded by the European Commission’s Seventh Framework Programme (Contract Number 225551), MTA “Firms, Strategy and Performance” Momentum Grant and MTA Bolyai Grant. Békés thanks the hospitality of CEPII. Fontagné thanks the hospitality of CESifo and acknowledges financial support from the Banque de France.


  1. Albornoz, F., Calvo Pardo, H. F., Corcos, G., & Ornelas, E. (2012). Sequential exporting. Journal of International Economics, 88, 17–31.CrossRefGoogle Scholar
  2. Alessandria, G., Kaboski, J. P., & Midrigan, V. (2010). Inventories, lumpy trade, and large devaluations. The American Economic Review, 100(5), 2304–2339.CrossRefGoogle Scholar
  3. Alessandria, G., Kaboski, J. P., & Midrigan, V. (2011). US trade and inventory dynamics. American Economic Review, 101(3), 303–307.CrossRefGoogle Scholar
  4. Araujo, L., & Ornelas, E. (2007). Trust-based trade (Technical report, CEP Discussion Papers dp0820). Centre for Economic Performance, LSE.Google Scholar
  5. Ariu, A. (2011). The margins of trade: Services vs goods, mimeo. Leuven: University of Leuven.Google Scholar
  6. Autor, D. H., Dorn, D., & Hanson, G. H. (2013). The China syndrome: Local labor market effects of import competition in the United States. American Economic Review, 103(6), 2121–2168.CrossRefGoogle Scholar
  7. Behrens, K., & Picard, P. M. (2011). Transportation, freight rates, and economic geography. Journal of International Economics, 85(2), 280–291.CrossRefGoogle Scholar
  8. Békés, G., Fontagné, L., Muraközy, B., & Vicard, V. (2015). Shipment frequency of exporters and demand uncertainty: An inventory management approach (CEPR Working Papers 11013).Google Scholar
  9. Berman, N., de Sousa, J., Martin, P., & Mayer, T. (2012). Time to ship during financial crises. In F. Giavazzi, K. West (Eds.), NBER International Seminar on Macroeconomics. Chicago: University of Chicago Press.Google Scholar
  10. Berman, N., Rebeyrol, V., & Vicard, V. (2015). Demand learning and firm dynamics: Evidence from exporters (Working Papers 551). Banque de France.Google Scholar
  11. Berthou, A., & Vicard, V. (2015). Firms’ export dynamics: Experience versus size. The World Economy, 38(7), 1130–1158.CrossRefGoogle Scholar
  12. Bloom, N., Floetotto, M., Jaimovich, N., Saporta-Eksten, I., & Terry, S. J. (2012). Really uncertain business cycles (NBER Working Papers 18245). National Bureau of Economic Research, Inc.Google Scholar
  13. Bloom, N., & Van Reenen, J. (2007). Measuring and explaining management practices across firms and countries. Quarterly Journal of Economics, 122(4), 1351–1408.CrossRefGoogle Scholar
  14. Broda, C., & Weinstein, D. E. (2006). Globalization and the gains from variety. The Quarterly Journal of Economics, 121(2), 541–585.CrossRefGoogle Scholar
  15. Cameron, A. C., & Miller, D. L. (2011). Robust inference with clustered data Handbook of empirical economics and finance (pp. 1–28). Boca Raton: CRC Press.Google Scholar
  16. Coleman, A. (2009). Storage, slow transport, and the law of one price: Theory with evidence from nineteeth century U.S. corn markets. Review of Economics and Statistics, 91(2), 332–350.CrossRefGoogle Scholar
  17. Dixit, A. K., & Pindyck, R . S. (1994). Investment under uncertainty. Princeton: Princeton University Press.Google Scholar
  18. Eaton, J., Eslava, M., Kugler, M., & Tybout, J. (2008). Export dynamics in colombia: Firm-level evidence. Borradores de Economia 522, Banco de la Republica de Colombia.Google Scholar
  19. Eaton, J., Kortum, S., & Kramarz, F. (2004). Dissecting trade: Firms, industries and export destinations. American Economic Review, 94(2), 150–154.CrossRefGoogle Scholar
  20. Evans, C. L., & Harrigan, J. (2005). Distance, time, and specialization: Lean retailing in general equilibrium. American Economic Review, 95(1), 292–313.CrossRefGoogle Scholar
  21. Handley, K., & Limao, N. (2015). Trade and investment under policy uncertainty: Theory and firm evidence. American Economic Journal: Economic Policy, 7(4), 189–222.Google Scholar
  22. Harrigan, J. (2010). Airplanes and comparative advantage. Journal of International Economics, 82(2), 181–194.CrossRefGoogle Scholar
  23. Hornok, C., & Koren, M. (2015a). Administrative barriers to trade. Journal of International Economics, 96(14), S110–S122.CrossRefGoogle Scholar
  24. Hornok, C., & Koren, M. (2015b). Per-shipment costs and administrative barriers to trade. Review of Economics and Statistics, 97(2), 525–530.CrossRefGoogle Scholar
  25. Hummels, D. L., & Schaur, G. (2010). Hedging price volatility using fast transport. Journal of International Economics, 82(1), 15–25.CrossRefGoogle Scholar
  26. Hummels, D. L., & Schaur, G. (2013). Time as a trade barrier. The American Economic Review, 103(7), 2935–2959.CrossRefGoogle Scholar
  27. Iacovone, L., & Javorcik, B. S. (2010). Multi-product exporters: Product churning, uncertainty and export discoveries*. The Economic Journal, 120(544), 481–499.CrossRefGoogle Scholar
  28. Kleinert, J., & Spies, J. (2011). Endogenous transport costs in international trade (IAW Discussion Papers 74). Institut für Angewandte Wirtschaftsforschung.Google Scholar
  29. Kropf, A., & Sauré, P. (2014). Fixed costs per shipment. Journal of International Economics, 92(1), 166–184.CrossRefGoogle Scholar
  30. Novy, D. & Taylor, A. (2013). Trade and uncertainty (Working Papers mimeo). National Bureau of Economic Research.Google Scholar
  31. Rauch, J. E., & Watson, J. (2003). Starting small in an unfamiliar environment. International Journal of Industrial Organization, 21(7), 1021–1042.CrossRefGoogle Scholar
  32. Santos Silva, J. M. C., & Tenreyro, S. (2006). The log of gravity. The Review of Economics and Statistics, 88(4), 641–658.CrossRefGoogle Scholar
  33. Steinwender, C. (2015). Information frictions and the law of one price: When the states and the kingdom became united. Technical report, Mimeo, Princeton University and Harvard Business School.Google Scholar
  34. Zipkin, P . H. (2000). Foundations of inventory management. New York: McGraw-Hill.Google Scholar

Copyright information

© Kiel Institute 2017

Authors and Affiliations

  1. 1.Institute of Economics of CERS-HASBudapestHungary
  2. 2.Central European UniversityBudapestHungary
  3. 3.CEPRLondonUK
  4. 4.PSEUniversity Paris 1ParisFrance
  5. 5.CEPIIParisFrance
  6. 6.Banque de FranceParisFrance

Personalised recommendations