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WORKING PAPER 10-10

Wholesalers and Retailers in US Trade

by Andrew B. Bernard, Tuck School of Business at Dartmouth and NBER
and J. Bradford Jensen, Peterson Institute for International Economics
and Stephen J. Redding, London School of Economics
and Peter K. Schott, Yale School of Management and NBER

International trade models typically assume that producers in one country trade directly with final consumers in another. In reality, of course, trade can involve long chains of potentially independent actors who move goods through wholesale and retail distribution networks. These networks likely affect the magnitude and nature of trade frictions and hence both the pattern of trade and its welfare gains. To promote further understanding of the means by which goods move across borders, this paper examines the extent to which US exports and imports flow through wholesalers and retailers versus producing and consuming firms.

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