Capacity building as a route to export market expansion: A six-country experiment in the Western Balkans

Ana P. Cusolito, Ornella Darova and David McKenzie

Journal of International Economics, 2023, vol. 144, issue C

Abstract: The limited market size of many small emerging economies is a key constraint to the growth of innovative small and medium enterprises. Exporting offers a potential solution, but firms may struggle to locate and appeal to foreign buyers. We conducted a six-country randomized experiment with 225 firms in the Western Balkans to test the effectiveness of 30 h of live group-based training and 5 h of one-on-one remote consulting in overcoming these constraints. Treated firms used techniques such as search engine optimization and improved Facebook content to increase their digital presence and better reach foreign customers. A year later, we find positive and significant impacts on the number of customers, and a significant intensive margin increase in export sales. Qualitative interviews suggest this improvement came from a combination of sector-specific advice on market expansion, and through an encouragement effect which gave entrepreneurs the confidence to try new sales strategies.

Keywords: Export market expansion; Training; Consulting; Digital presence; Customer acquisition (search for similar items in EconPapers)
JEL-codes: C93 F14 L26 O12 O25 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:144:y:2023:i:c:s0022199623000806

DOI: 10.1016/j.jinteco.2023.103794

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