Demand Learning and Firm Dynamics: Evidence from Exporters

Nicolas Berman (), Vincent Rebeyrol and Vincent Vicard

No 1846, AMSE Working Papers from Aix-Marseille School of Economics, France

Abstract: This paper provides direct evidence that learning about demand is an important driver of firms' dynamics. We present a model of Bayesian learning in which firms are uncertain about their idiosyncratic demand in each of the markets they serve, and update their beliefs as noisy information arrives. Firms are predicted to update more their beliefs to a given demand shock, the younger they are. We test and empirically confirm this prediction, using the structure of the model together with exporter-level data to identify idiosyncratic demand shocks and the firms’ beliefs about future demand. Consistent with the theory, we also find that the learning process is weaker in more uncertain environments.

Keywords: firm growth; belief updating; demand; exports; uncertainty (search for similar items in EconPapers)
JEL-codes: D83 F14 L11 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2018-12
New Economics Papers: this item is included in nep-bec and nep-int
References: Add references at CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://www.amse-aixmarseille.fr/sites/default/fil ... /wp_2018_-_nr_46.pdf (application/pdf)

Related works:
Journal Article: Demand Learning and Firm Dynamics: Evidence from Exporters (2019)
Working Paper: Demand Learning and Firm Dynamics: Evidence from Exporters (2019)
Working Paper: Demand Learning and Firm Dynamics: Evidence from Exporters (2018)
Working Paper: Demand learning and firm dynamics: evidence from exporters (2017)
Working Paper: Demand learning and firm dynamics:evidence from exporters (2016)
Working Paper: Demand learning and firm dynamics: evidence from exporters (2015)
Working Paper: Demand learning and firm dynamics: evidence from exporters (2015)
Working Paper: Demand learning and firm dynamics: evidence from exporters (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aim:wpaimx:1846

Access Statistics for this paper

More papers in AMSE Working Papers from Aix-Marseille School of Economics, France AMU-AMSE - 5-9 Boulevard Maurice Bourdet, CS 50498 - 13205 Marseille Cedex 1. Contact information at EDIRC.
Bibliographic data for series maintained by Gregory Cornu ().