33 / 2015-12-22 17:04:46

Co-movements in U.S. Import and Export Markets: Minimum Spanning Trees Analysis

We evaluate that the trade relationships of all commodities in U.S. import and export markets during three different time windows – before the financial crisis, during the financial crisis, and after the financial crisis. The analysis is based on 98 Harmonized System Codes (HS Codes) commodity classification in the U.S. import market and 97 HS Codes commodity classification in the U.S. export market from 2002 to 2015. We use the minimum spanning tree (MST) analysis to examine the patterns of co-movements for a set of import and export trades data in the United States during three different time periods. The results indicate that “Plastics and Articles Thereof” as one of HS Codes commodity classifications has consistently constituted the most tightly linked markets in the U.S. import and export markets across three time windows. However, there are some different trade patterns among three time periods. Textile commodities, Metals and Foodstuffs commodities, and Transportation and Medical Miscellaneous commodities were the centers of the import network before the financial crisis, during the financial crisis, and after the financial crisis respectively. Furthermore, Chemicals & Allied Industries and Wood & Wood Products commodities, Metals and Furniture Miscellaneous commodities, and Foodstuffs and Chemicals & Allied Industries commodities were the centers of the export network before the financial crisis, during the financial crisis, and after the financial crisis respectively. Therefore, policymakers could find appropriate international trade strategies in order to improve the domestic economy and efficiency of resource allocation.