Fatma Bouattour : Impact of Financial Frictions on International Trade in Brazil and Emerging Countries

This thesis is motivated by two sets of arguments. First, there has been a renewed interest in the link between finance and international trade since the global crisis of 2008. Second, the last decades have been marked with the emergence of BRICS countries as major actors in the world economy. Considering these elements, this document aims at deepening the analysis of the effects of financial constraints on international trade performances, with a focus on the BRICS (Brazil, Russian Federation, India, China, South Africa), notably Brazil. This thesis includes three chapters. The first chapter aims at evaluating the level of financial vulnerability of Brazilian manufacturing sectors in the 2000s, based on the pioneering work of Rajan and Zingales (1998, RZ). Based on a discussion on the pertinence of RZ dependence on external finance indicators, this chapter stresses the importance of the financial development and of public credits in causing the inter-sectoral capital misallocation. The second chapter focuses on the link between financial constraints and the performances of Brazilian exporters, in a framework of heterogeneous firms as in Manova (2013). Specifically, I revisit the link between firm size and firm exports by focusing on the financial constraints at sector-level. Findings emphasize the importance of problems of access to credit in Brazil, in explaining Brazilian firms’ export performances. The third chapter analyzes the effects of financial development in exporting countries on their exports to BRICS countries, with a focus on the recent financial crisis effects. Results confirm the role of financial development as a source of comparative advantage in sectors with high reliance on external finance. The positive effect related to financial development is lessened during the crisis of 2008. This confirms the importance of the trade finance transmission channel of the crisis and put into perspective the advantages of the financial development in the recent context characterized by a deeper trade and financial linkages.     

JEL Classification: F12, F14, F42, G01, G10, G20, G32, L25, O16, O38, O54

Keywords: Financial development, External finance dependence, Resource allocation, Financial crisis, Exports, Brazil, BRICS