{"id":1498,"date":"2023-02-13T16:19:18","date_gmt":"2023-02-13T16:19:18","guid":{"rendered":"https:\/\/www.fiw.ac.at\/publications\/finance-comparative-advantage-and-resource-allocation\/"},"modified":"2023-02-13T16:19:18","modified_gmt":"2023-02-13T16:19:18","slug":"finance-comparative-advantage-and-resource-allocation","status":"publish","type":"publication","link":"https:\/\/www.fiw.ac.at\/en\/publications\/finance-comparative-advantage-and-resource-allocation\/","title":{"rendered":"Finance, Comparative Advantage, and Resource Allocation"},"content":{"rendered":"\nWe show that exported products exit the US market sooner if they violate the Heckscher-Ohlin notion of comparative advantage. Crucially, this pattern is stronger when exporting country has a well-developed banking system, measured by a high ratio of bank credit over the GDP. Banks thus push firms away from exports that are facing an uphill battle on a competitive foreign market due to a suboptimal use of the domestic factor endowment. Our results imply a disciplining role for bank credit in terminating inefficient trade flows. This constitutes a new channel through which finance improves resource allocation in the real economy.\n\n","protected":false},"featured_media":0,"menu_order":0,"template":"","jelcode":[209,67,688,68],"keyword":[221,682,690,689],"class_list":["post-1498","publication","type-publication","status-publish","hentry","jelcode-f11","jelcode-g21","jelcode-g30","jelcode-o16","keyword-comparative-advantage","keyword-export-survival","keyword-finance","keyword-resource-misallocation"],"acf":{"year":2014,"month":2,"day":"","volume":"","number":"130","pages":36,"reviewed":"0","citeid":"FIW_WP_130","fiwseries":"FIW Working Papers","event":null},"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v23.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Finance, Comparative Advantage, and Resource Allocation - FIW<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.fiw.ac.at\/en\/publications\/finance-comparative-advantage-and-resource-allocation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Finance, Comparative Advantage, and Resource Allocation - FIW\" \/>\n<meta property=\"og:description\" content=\"We show that exported products exit the US market sooner if they violate the Heckscher-Ohlin notion of comparative advantage. Crucially, this pattern is stronger when exporting country has a well-developed banking system, measured by a high ratio of bank credit over the GDP. 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