Relationship Stickiness, International Trade, and Economic Uncertainty
Abstract
Abstract We study how stickiness in business relationships influences the trade impact of aggregate uncertainty. To begin, we construct a product-level index of relationship stickiness using firm-to-firm relationship duration data. We then demonstrate how relationship stickiness shapes trade dynamics in response to uncertainty shocks. We find that episodes of uncertainty lead to a decline in the overall establishment of new business relationships, with the impact varying depending on the level of stickiness. In markets characterized by high stickiness, uncertainty shocks primarily impede investments in new firm-to-firm relationships. In contrast, for nonsticky products, the adjustment to uncertainty shocks mainly manifests as the disruption of existing relationships.
Fields of Study & Subjects
International Business and FDI
Global trade and economics
Defense
Military
and Policy Studies
Publication details
- Journal / source
- HAL (Le Centre pour la Communication Scientifique Directe)
- Publisher
- MIT Press
- Volume
- 108
- Issue
- 1
- Pages
- 179-193
- Publication date
- 1 January 2026
- Language
- EN