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To reduce funds for Russia’s Ukraine invasion, Western governments imposed a price ceiling on Russian seaborne oil exports using Western services. To sell above that ceiling, Russia developed a “shadow fleet” which uses no such services. We use a calibrated model driven by this fleet’s...
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We study how demand uncertainty affects risk-neutral firms. number of export destinations when uncertainty is resolved … after firms choose their export destinations and output. We show that firms’ ability to allocate their output across … destinations in response to destination-specific shock realizations provides even risk-neutral firms an incentive to export …
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Regardless of the size of the domestic economy, there are ample reasons for firms to extend their markets beyond home shores. These include increasing sales, improving profits, diversifying risks, reaping economies of scale, matching the moves of competitors, enhancing competitiveness or...
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