policymakers demonstrate

244 Cecília Hornok and Miklós Koren
as barriers to all forms of services trade (cross-border, FDI or movement of
people). Drawing on policy experience with the WTO’s General Agreement
on Trade in Services (GATS) and other bilateral liberalization efforts, Hoekman
and Mattoo (2013) emphasize that services trade liberalization cannot be
separated from regulatory reform and international regulatory harmonization.
During recent years much has been done to overcome the serious data limitations
in the field of trade in services. Bilateral service flow data from several
different sources have been consolidated in a global database (Francois et al.,
2009). Firm-level data on services trade are available for more and more countries.
Information on barriers to services trade are summarized in two largescale
projects, the World Bank’s Services Trade Restrictions Database (World
Bank, 2015, Borchert et al., 2012a,b) and the OECD’s Services Trade Restrictiveness
Index (OECD, 2015). Nevertheless, there is still a lot to be done in
the future to build and maintain comprehensive and reliable databases in this
field.
Challenge 4 Build harmonized firm-level data on services trade.
Matched Buyer-seller Data
Most theoretical frameworks, even when they deal with business-to-business
transactions, treat one side of the market as anonymous. In these models,
exporters sell to many anonymous buyers, and importers buy from many anonymous
sellers. In reality, however, most firms are only linked to a few buyers and
few suppliers.
Understanding the nature of buyer-supplier linkages is crucial for two reasons.
First, firms differ in their set of buyers and set of suppliers, and this heterogeneity
may contribute to heterogeneity in performance (Eaton et al., 2013).
We want to understand how firms with few and many links behave differently.
Second, the structure of the network may affect the behavior of the entire economic
system (Acemoglu et al., 2012).
Bernard et al. (2014b) analyse a novel two-sided dataset on trade. Using
transaction-level trade data from Norway, they identify buying and selling
firms, and document a number of facts about the distribution of trade flows
across buyers and sellers. First, there is substantial variation in the number
of buyers per seller. Most firms sell to a single buyer, but large firms sell to
many buyers. Second, the distribution of sales across buyers does not vary
systematically with firm size. Third, larger sellers sell to, on average, smaller
buyers.
Carballo et al. (2013) study a similar buyer–seller dataset for Costa Rica,
Ecuador and Uruguay. They show how the number of buyers varies across destination
markets. Firms have more buyers in large and close markets. In markets
with tougher competition, the distribution of sales is more skewed towards the
largest buyer. Carballo et al. (2013) also build a model to show that increased