The granular nature of the great export collapse in german manufacturing industries, 2008/2009

The Granular Nature of the Great Export Collapse in German Manufacturing Industries, 2008/2009
Joachim Wagner
Leuphana University Lueneburg and IZA, Bonn

Abstract This paper uses comprehensive high-quality panel data from official statistics for exporting enterprises to investigate the micro-structure of the recent export collapse in manufacturing industries in Germany during the crisis of 2008/2009.
Almost all of the decline in exports was due to negative changes of exports in firms that continue to export (i.e. at the so-called intensive margin) while the decrease of exports due to export stoppers (at the so-called extensive margin) was tiny. It is shown that idiosyncratic shocks to very large firms played a decisive role in shaping the export collapse.
JEL F14, E23
Keywords Exports; great trade collapse; granular economy; Germany

Correspondence Joachim Wagner, Leuphana University Lueneburg, Institute of
Economics, D-21332 Lueneburg, Germany; e-mail: [e-mail] .
This is a revised version of the author’s working paper Wagner (“The Microstructure of the Great Export Collapse in German Manufacturing Industries, 2008/2009,”
2012). The author thanks participants at various presentations for helpful comments.
All computations were done inside the Research Data Centre of the Statistical Office of
Berlin-Brandenburg. The data used are confidential but not exclusive; see Zühlke et al.
(“The Research Data Centres of the Federal Statistical Office and the Statistical
Offices of the Länder,” 2004) for a description of how to access the data.

© Author(s) 2012. Licensed under a Creative Commons License - Attribution-NonCommercial 2.0 Germany

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Motivation

In late 2008 world trade experienced a sudden, severe and synchronized collapse that was the sharpest in recorded history and the deepest since World War II – this is now known as The Great Trade Collapse (Baldwin 2009, p. 1).1 German exports are a case in point. 2009