Learning about demand abroad from wholesalers: a B2B analysis

William Connell, Emmanuel Dhyne and Hylke Vandenbussche

No 643224, Working Papers of Department of Economics, Leuven from KU Leuven, Faculty of Economics and Business (FEB), Department of Economics, Leuven

Abstract: This paper uses Business to Business (B2B) transaction level data. It shows that manufacturing firms that initially export via a wholesaler are much more likely to become direct exporters to the same destination in subsequent periods. Theoretically, we rationalize this finding by demonstrating how a connection to a wholesaler reduces uncertainty about the foreign demand. In the data we isolate the channel for demand learning from productivity spillovers. Non-exporting manufacturing firms, previously serving a foreign destination through an exporting wholesaler, have a much higher probability of becoming direct exporters to the same export market in subsequent periods. A connection to an exporting wholesaler results in a probability of exporting to the same destination that is six times higher than a comparable firm without any exposure to the foreign destination.

Pages: 48
Date: 2019-11-14
New Economics Papers: this item is included in nep-eur and nep-int
Note: paper number DPS 18.12
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Published in FEB Research Report Department of Economics

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https://lirias.kuleuven.be/retrieve/551629 Published version (application/pdf)

Related works:
Working Paper: Learning About Demand Abroad From Wholesalers: a B2B Analysis (2019)
Working Paper: Learning about demand abroad from wholesalers: a B2B analysis (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:ete:ceswps:643224

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