On the stability of trade partnerships

In his landmark study of US commodity flows, Ullman explains flow as being determined by complementarity, intervening opportunity, and transferability. Of these three concepts, only complementarity can be readily tested empirically; this may be accomplished through an analysis of trade partnerships. Despite rapidly fluctuating flow volumes, results of this analysis indicate that trade partnerships are predominantly stable. Further, partnerships involving large volumes are much more stable than those involving small volumes. This provides evidence of the role of spot markets in determining the pattern of commodity flows.