Extensive and Intensive margins à la Hummels and Klenow (2005)

[Stef Luck]

Dear Stata users,
I am studying the effect of migration on trade and I would like to start on calculating the Extensive and Intensive margins according to Hummers and Klenow (2005).

I found the user-written command hummels (link) but I see that it may not calculate margins correctly and also in this thread of the forum (reply #5) (link) makes me question the hummels module.

Here is a sample of my dataset.

* Example generated by -dataex-. To install: ssc install dataex
clear
input str59 i_country int i_code str2 i_iso2 str3 i_iso3 str59 j_country int j_code str2 j_iso2 str3 j_iso3 int year long(Emigrants_Total Immigrants_Total) int sitc double(export_val import_val)
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . .  111      0    722
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . .  484    150      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 1995 . .  585   3670      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 1995 . .  711  68848      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . .  730      0 393986
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 1995 . .  741  24702      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 1995 . . 1110  20535      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 1110 619706      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 1110 221782      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 1110 196728      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 1121   5402      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 1121  10783      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 1124   4985      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 2482      0  23799
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 2690  10324      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 5156      0   3481
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5231     34      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5335   5624      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5542    207      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 5821     50      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5821   3942      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5823    217      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5824    287      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5825    287      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 5833    593      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5833    730      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 5839      0   1618
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 5839    511      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 5843    134      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6210    363      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6282     16      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6289    179      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6289   1937      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6289    630      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6343  25227      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6343  31434      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6354   1237      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6359    608      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6416   2087      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 6421  22549      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6421  31430      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6421     42      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 6423   4416      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6423   2249      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6428    936      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6428     17      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6571      3      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6572     48      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6573   3203      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6582   1383      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6584     98      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 6589      0    358
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6589     48      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6648   1072      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 6652  42288      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6652   5745      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6652   3308      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6664   3385      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6666   2092      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 6785      0  13759
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6785     16      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6931    189      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6940    737      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6940    105      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6953     10      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6953    901      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6953    235      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 6954      0   1313
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6954     15      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6954   1085      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 6960    201      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6960    244      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6974    276      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6978      0    127
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6991    126      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6991   4713      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 1995 . . 6996   1587      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6996   1618      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6996    363      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6997   1539      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 6997     12      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 6997    183      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 6998    158      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 7139    232      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 7162   1346      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 1995 . . 7188   1289      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 7188   9236      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 1995 . . 7239  20237      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 7239    937      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 7243    146      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 7267   1004      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2015 . . 7281    730      .
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 7283 423401      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 7283   8209      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 1995 . . 7284  24702      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 7284   5353      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 7284     49      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2000 . . 7414  21679      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2005 . . 7414    738      0
"Austria" 40 "AT" "AUT" "Aruba" 533 "AW" "ABW" 2010 . . 7414    396      0
end

What I understand from the Hummels and Klenow is that they calculate intensive margin (IM) as (total exports of j to m) / (total exports of the RoW to m for the same product set), whereas the hummels module seems to calculate IM as (total exports of j to m) / (total exports of the RoW to m). Therefore EM calculation is also wrong.

Could someone, that have maybe met this problem before, please help me to calculate margins properly?

I hope that I have included all relevant information.

Thank you

[Stef Luck]

Is there anybody who can help??

[Nick Cox]

See generic advice on bumping at https://www.statalist.org/forums/help#adviceextras #1

My guess is simple: most readers, like me, stopped at the thread title or at

Extensive and Intensive margins according to Hummers and Klenow (2005).

as they are not familiar with either. You could try emailing the author of hummels (SSC); otherwise it seems that no-one who has worked in this area is minded to reply.

[Stef Luck]

Dear Nick, thank you for your reply and I am sorry for bumping the post.

I am trying to solve it by myself.

Anyway, could please explain - starting from my sample - how can I get a ratio of:

(Total exports of A to B for a given product) / (Total exports of the Rest of the World to B for the same product)?

In my dataset: country of origin is identified by i_iso3, country of destination is j_iso3, total exports is export_val, and the products are identified by sitc variable.

I know it may seem trivial to you, but I don't get how to exclude the country of the numerator from the calculation of the denominator (all other i_iso3).

Thank you for your time

[Nick Cox]

egen, total() is your friend. Just parse the problem into code for numerator and denominator variables and divide.

The identity

total for all other countries = total for all countries MINUS total for this country

is crucial.