Margins, concentration, and the performance of firms in international trade: Evidence from Japanese customs data

doi:10.1016/j.jjie.2024.101340

Journal of the Japanese and International Economies

Volume 75, March 2025, 101340

https://doi.org/10.1016/j.jjie.2024.101340 Get rights and content

Under a Creative Commons license

open access

Highlights

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Japan’s international trade during 2014–2020 is investigated at the firm-level.
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The first study to comprehensively analyze Japan’s trade using Japan Customs data.
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The extensive and intensive margins of Japan’s international trade are analyzed.
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The degree of concentration of trading firms in Japan’s trade is also examined.
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Matched with firm-level data, the performance premia of export firms are estimated.

Abstract

This study is the first to comprehensively investigate international trade at the firm-level using Japan’s customs data for the 2014–2020 period. We first decompose international trade into the intensive and extensive margins and show that the intensive margin accounts for around 30% and 40% of the variation in partner country-specific exports and imports, respectively. We next find a substantial concentration of trading firms: in 2017, the top 10% of exporters accounted for 96.6% of all exports, while the top 10% of importers were responsible for 94.6% of all imports. Finally, we match the customs data with other firm-level datasets and estimate the performance premia of exporting firms. Our findings indicate that exporting manufacturing firms outperform non-exporting manufacturing firms in all aspects we consider: sales, value added, the number of employees, the capital-labor ratio, productivity, and wages. Interestingly, the exporter premia of manufacturing firms for value added, labor productivity, and total factor productivity decreased between 2014 and 2016 and then increased until 2019, whereas the exporter premium for the average wage steadily increased.

JEL classification

F14

L25

Keywords

Japan’s international trade

Customs data

Intensive and extensive margins of trade

Exporter premia

Data availability

The data that has been used is confidential.

Cited by (0)

^☆: This study is an outcome of the research conducted jointly with the Policy Research Institute (PRI) after submitting a request for use of customs’ export and import declaration data to the Ministry of Finance (MOF) based on the “Guideline on the utilization of customs’ import and export declaration data in a joint research with Policy Research Institute,” and receiving approval in February 2022. The views expressed in this paper are those of the authors’ personal responsibility and do not represent the official views of MOF or PRI. The authors would like to thank Kenta Ando, Shintaro Negishi, Uraku Yoshimoto, and Fumiharu Ito of the PRI of the MOF Japan for their guidance on the dataset used in this research and helpful comments. We are grateful to Sawako Maruyama, Ryuhei Wakasugi, participants at the 2024 Spring Meeting of the Japanese Economic Association and the Kansai Branch Workshop of the Japan Society of International Economics, and anonymous referees for their invaluable comments. Financial support from the Japan Society of the Promotion of Science, KAKENHI , under grant numbers 19K01658, 20H01501, 23H00817, 23K01396, 23K25514, 23K25518, and 24K16371 is gratefully acknowledged. All subsequent errors are our own.