Sequential exporting


Albornoz, Facundo, Pardo, Héctor F. Calvo, Corcos, Gregory and Ornelas, Emanuel (2012) Sequential exporting Journal of International Economics, 88, (1), pp. 17-31. (doi:10.1016/j.jinteco.2012.02.007).

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Description/Abstract

Many new exporters give up exporting very shortly, despite substantial entry costs; others shoot up foreign sales and expand to new destinations. We develop a model based on experimentation to rationalize these and other dynamic patterns of exporting firms. We posit that individual export profitability, while initially uncertain, is positively correlated over time and across destinations. This leads to “sequential exporting,” where the possibility of profitable expansion at the intensive and extensive margins makes initial entry costs worthwhile despite high failure rates. Firm-level evidence from Argentina's customs, which would be difficult to reconcile with existing models, strongly supports this mechanism

Item Type: Article
Digital Object Identifier (DOI): doi:10.1016/j.jinteco.2012.02.007
ISSNs: 0022-1996 (print)
Keywords: export dynamics, trade liberalization, experimentation, uncertainty
Subjects:
Organisations: Economics
ePrint ID: 80134
Date :
Date Event
20 February 2012e-pub ahead of print
Date Deposited: 24 Mar 2010
Last Modified: 18 Apr 2017 20:11
Further Information:Google Scholar
URI: http://eprints.soton.ac.uk/id/eprint/80134

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