DP11534 | Volatility in the Small and in the Large: The Lack of Diversification in International Trade

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This paper is a thoroughly revised version of the paper entitled "Volatility in the Small and in the Large: Evidence from Trade Networks". The different versions of the paper have benefited from comments of seminar and conference participants at Aix-Marseille School of Economics, Brown University, Budapest-CEU, Duke University, Ecole Polytechnique, LMU Munich, Oslo University, Princeton University, Université Laval, Université Libre de Bruxelles, U. de Montréal, University of Zurich, Yale University, SED Toronto, the CEPR-ERWIT conference, the NBER-IFM Summer Institute, HEC Montréal micro-macro workshop and the LSE Workshop on Networks in Macro & Finance. We are particularly grateful to Ezra Oberfield and Felix Tintelnot for insightful discussions of earlier versions. This project has received funding from the European Research Council (ERC) under the European Union’s Horizon 2020 research and innovation programme (grant agreement No 714597). Our work is also supported by a public grant overseen by the French National Research Agency (ANR) as part of the “Investissements d’Avenir” program (Idex Grant Agreement No. ANR-11-IDEX-0003-02 / Labex ECODEC No. ANR-11-LABEX-0047). Martin thanks FRQSC for financial support (grant 2015-NP-182781).