Essays in empirical international trade

This dissertation brings together three empirical studies of international trade issues covering trade policy reforms, trade patterns and the duration of trade relationships in Latin American countries. In the first essay, we review export activities in Brazil since the 1990s, describing changes in export basket composition and diversification of destination markets. Using highly disaggregated trade data, we decompose export growth into the extensive margin (exports of new goods) and the intensive margin (more exports of established goods). We then estimate a probabilistic model of export decisions to investigate whether previous export experience in proximate markets contributes to the shipment of new goods to a trade partner. We find that prior export experience in neighboring countries has a small, positive effect on the probability of exporting in the future. As far as export promotion is concerned, this suggests that new trade relationships should be formed with countries within regions where previous export experience exists. After describing, in the first essay, what products and to what countries Brazil exports, in the second essay we study how long trade relationships last. We characterize the duration of trade relationships by investigating the length of time until Brazil stops exporting a good to a country and whether exports of particular products or to particular markets last longer than others. Our results indicate that trade relationships have a very short life, with a median duration of only 2 years. We add to the list of trade policy recommendations on export promotion by suggesting that instead of encouraging new relationships it might be better to prevent the existing ones from ending too soon. In the last essay, we study trade issues in another Latin American country. We perform a quantitative analysis of the impact of various trade policies on international trade patterns, domestic prices and poverty in Bolivia. With a unique dataset combining trade data with survey data at the household level, we simulate the magnitude of a variety of trade shocks using a partial-equilibrium model, feed these shocks into price and quantity changes, and finally feed these price and quantity changes into household incomes and expenditures.