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Old Firms and New Export Flows: Does Experience Increase Survival?

Martina Lawless and Zuzanna Studnicka ()

No 201919, Working Papers from School of Economics, University College Dublin

Abstract: In this paper we present new empirical evidence on the relationship between exporting experience and the duration of export relationships at the firm-product-destination level. Our starting hypothesis that more experienced exporters would have longer lived product-market trade relationships is quite strongly rejected in baseline specifications. However,we find that when we introduce interaction effects between experience and product scope and also between experience and similarity to the firm's core export product, our results change considerably. These findings suggest that at some level of experience as an exporter there is a decline in the marginal return on the positive effects on survival of product diversification and proximity. We suggest that this is evidence that more experienced firms launch product-destination pairs further away from their core competence and/or into more risky markets which therefore increases the risk of failure of any individual product-destination pairing.

Keywords: Duration of trade; Survival models; Export experience; Multi-product firms (search for similar items in EconPapers)
JEL-codes: F10 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-int and nep-sbm
Date: 2019-09
References: View references in EconPapers View complete reference list from CitEc
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http://hdl.handle.net/10197/11086 First version, 2019 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:ucn:wpaper:201919

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