Networks and the Dynamics of Firms' Export Portfolio: Evidence for Mexico

Juan de Lucio, Raúl Mínguez, Asier Minondo () and Francisco Requena Silvente
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Raúl Mínguez: High Council of Spanish Chambers of Commerce, Spain

No 2014003, Working Papers from The University of Sheffield, Department of Economics

Abstract: In this paper we use network-analysis tools to identify communities in the web of exporters' destinations. Next we use our network-based community measure as predictor of additional countries chosen by firms expanding their export destination portfolio. We defend that our network-based community measure is superior to extended gravity measures. This superiority stems from the fact that community is a revealed measure, is country-specific and can be calculated at the industry level. Using data on Mexican new exporters over the period 2003-2009, we show that the probability of choosing a new export destination multiplies almost by three if it belongs to the same community of any of the firm's previous destinations. The introduction of the network-based community variable improves the accuracy of the model up to 20% relative to a model that only includes gravity and extended gravity variables. We also show that industry-specific communities and general communities play similar roles in determining the dynamics of Mexican exporters' country portfolio.

Keywords: export market; network analysis; modularity; extended gravity; Mexico (search for similar items in EconPapers)
JEL-codes: F1 (search for similar items in EconPapers)
Pages: 36 pages
Date: 2014-02
New Economics Papers: this item is included in nep-int and nep-net
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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http://www.shef.ac.uk/economics/research/serps/articles/2014_003.html First version, February 2014 (application/pdf)

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Journal Article: Networks and the Dynamics of Firms' Export Portfolio: Evidence for Mexico (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:shf:wpaper:2014003

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