How Exporters Grow

Doireann Fitzgerald, Stefanie Haller and Yaniv Yedid-Levi

No 201702, Working Papers from School of Economics, University College Dublin

Abstract: We document how export quantities and prices evolve after entry to a market. Controlling for marginal cost, and taking account of selection on idiosyncratic demand, there are economically and statistically significant dynamics of quantities, but no dynamics of prices. To match these facts, we estimate a model where firms invest in customer base through non-price actions (e.g. marketing and advertising), and learn gradually about their idiosyncratic demand. The model matches quantity, price and exit moments. Parameter estimates imply costs of adjusting investment in customer base, and slow learning about demand, both of which generate sluggish responses of sales to shocks.

Keywords: Exporter dynamics; Customer base; Learning (search for similar items in EconPapers)
JEL-codes: F1 L11 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2017-01
New Economics Papers: this item is included in nep-int and nep-mkt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

Downloads: (external link)
http://hdl.handle.net/10197/8363 First version, 2017 (application/pdf)

Related works:
Journal Article: How Exporters Grow (2024)
Working Paper: How Exporters Grow (2020)
Working Paper: How Exporters Grow (2016)
Working Paper: How Exporters Grow (2016)
Working Paper: How Exporters Grow (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:ucn:wpaper:201702

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