Economics & Finance / Macroeconomics / International Trade & Globalization

Why Big Importers Don't Buy More from Each Supplier (Colombia Reveals the Truth)

Andrew B. Bernard, Esther A. Bøler, Swati Dhingra

Think trade is just about countries exchanging goods? Think again. In this deep dive based on Andrew B. Bernard, Esther A. Bøler, and Swati Dhingra's 2018 study on Colombian imports, we expose the hidden network of firm-to-firm connections that actually drives global trade. You'll discover why large importers don't buy more from each supplier—they just have more suppliers. And the most shocking finding: the 'negative degree assortativity' means popular exporters don't pair with popular importers. Instead, small exporters must rely on giant importers to survive. We break down how 50% of trade relationships die within a year, but those that last 10 years explode in value. This isn't boring economics; it's the real story of how businesses connect across borders.