Learning to Export and the Timing of Entry to Export Markets

Nicholas Sheard

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Abstract: Exporters normally enter their first foreign markets some time after beginning to sell locally, then enter subsequent markets progressively. Standard trade models are essentially static and do not explain these elementary facts about exporting, which can bias the estimation of trade patterns. This paper proposes a model that endogenously generates the timing of entry to new export markets. The timing results from a learning mechanism. More productive firms are less sensitive to the learning effect and therefore (1) enter markets more quickly and (2) enter larger markets earlier and smaller markets later. These predictions are confirmed using Swedish firm-level data.

Keywords: Economie; quantitative (search for similar items in EconPapers)
Date: 2014
Note: View the original document on HAL open archive server: https://amu.hal.science/hal-01474269
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Citations: View citations in EconPapers (16)

Published in Review of International Economics, 2014, 22 (3), pp.536--560. ⟨10.1111/roie.12132⟩

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Journal Article: Learning to Export and the Timing of Entry to Export Markets (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-01474269

DOI: 10.1111/roie.12132

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