Extending the Learning-By-Exporting Hypothesis: Introducing a Credit Constraint

Kazuhiko Yokota () and Akinori Tomohara ()

International Advances in Economic Research, 2009, vol. 15, issue 2, 169-177

Abstract: This paper develops a theoretical framework which can be used to examine policy implications from the learning-by-exporting hypothesis. This work builds on previous theoretical literature by introducing a credit constraint. When credit is available, the analysis suggests that supporting a learning sector via an export subsidy is not necessarily advised to improve social welfare. The learning sector’s goods may be over-produced (relative to another non-tradable sector goods) when consumers can borrow freely for their consumption. If the learning sector’s goods are over-produced, social welfare will be improved via a tax on production. Copyright International Atlantic Economic Society 2009

Keywords: Export subsidy; Learning-by-exporting; Knowledge spillover; F1; F4; O2 (search for similar items in EconPapers)
Date: 2009
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DOI: 10.1007/s11294-009-9202-2

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