Resumen de Firm-Level Heterogeneity and the Aggregate Exchange Rate Effect on Exports.

Robert Dekle, Hyeok Jeong, Heajin H. Ryoo

• We investigate what accounts for the different evidence between the aggregate and firm-level data on the exchange rate elasticity of exports. The typical estimation of the macroeconomic export equations gives insignificant estimates for this elasticity compared to those from the recent firm-level estimation. Using firm-level data from Japan, we identify the sources of this discrepancy, and show that the failure to account for cost and demand factors as well as firm-level productivity induces various kinds of biases for the aggregate estimate of the exchange rate elasticity of exports.