Survival in export markets
- Autores
- Albornoz, Facundo; Fanelli, Sebastián; Hallak, Juan Carlos
- Año de publicación
- 2016
- Idioma
- inglés
- Tipo de recurso
- artículo
- Estado
- versión publicada
- Descripción
- This paper explores the determinants of firm survival in export markets. We build an exporter dynamics model where firms need to pay market-specific sunk and fixed costs to operate abroad and where firm export profitability in each foreign market follows a geometric Brownian motion. Firms also differ ex ante by a constant market-specific profitability shifter. We derive the probability of export survival upon entry in a market and show that it increases with the ratio of sunk to fixed costs and is insensitive to the profitability shifters. Also, we show that the survival probability is unaffected by fixed costs if sunk costs are zero. We take the model to the data using firm-level Argentine export information. We find that survival rates decrease with distance, which the model rationalizes with sunk costs that increase with distance proportionally less than fixed costs. Estimated sunk costs are small. In fact, a counterfactual exercise shows that removing those costs increases aggregate exports by less than 1.5%. Finally, we also find that survival increases with a firm's export experience. Analogously to distance, the model's implication of this empirical result is that experience reduces sunk costs proportionally less than fixed costs.
Fil: Albornoz, Facundo. Consejo Nacional de Investigaciones Científicas y Técnicas; Argentina. University of Nottingham; Estados Unidos
Fil: Fanelli, Sebastián. Massachusetts Institute of Technology; Estados Unidos
Fil: Hallak, Juan Carlos. Consejo Nacional de Investigaciones Científicas y Técnicas; Argentina. Universidad de San Andrés; Argentina. Ministerio de Industria; Argentina - Materia
-
EXPORT DYNAMICS
FIRM HETEROGENEITY
FIXED AND SUNK COSTS
GEOMETRIC BROWNIAN MOTION
PRODUCTIVITY
SURVIVAL - Nivel de accesibilidad
- acceso abierto
- Condiciones de uso
- https://creativecommons.org/licenses/by-nc-sa/2.5/ar/
- Repositorio
- Institución
- Consejo Nacional de Investigaciones Científicas y Técnicas
- OAI Identificador
- oai:ri.conicet.gov.ar:11336/115722
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Survival in export marketsAlbornoz, FacundoFanelli, SebastiánHallak, Juan CarlosEXPORT DYNAMICSFIRM HETEROGENEITYFIXED AND SUNK COSTSGEOMETRIC BROWNIAN MOTIONPRODUCTIVITYSURVIVALhttps://purl.org/becyt/ford/5.2https://purl.org/becyt/ford/5This paper explores the determinants of firm survival in export markets. We build an exporter dynamics model where firms need to pay market-specific sunk and fixed costs to operate abroad and where firm export profitability in each foreign market follows a geometric Brownian motion. Firms also differ ex ante by a constant market-specific profitability shifter. We derive the probability of export survival upon entry in a market and show that it increases with the ratio of sunk to fixed costs and is insensitive to the profitability shifters. Also, we show that the survival probability is unaffected by fixed costs if sunk costs are zero. We take the model to the data using firm-level Argentine export information. We find that survival rates decrease with distance, which the model rationalizes with sunk costs that increase with distance proportionally less than fixed costs. Estimated sunk costs are small. In fact, a counterfactual exercise shows that removing those costs increases aggregate exports by less than 1.5%. Finally, we also find that survival increases with a firm's export experience. Analogously to distance, the model's implication of this empirical result is that experience reduces sunk costs proportionally less than fixed costs.Fil: Albornoz, Facundo. Consejo Nacional de Investigaciones Científicas y Técnicas; Argentina. University of Nottingham; Estados UnidosFil: Fanelli, Sebastián. Massachusetts Institute of Technology; Estados UnidosFil: Hallak, Juan Carlos. Consejo Nacional de Investigaciones Científicas y Técnicas; Argentina. Universidad de San Andrés; Argentina. Ministerio de Industria; ArgentinaElsevier2016-09info:eu-repo/semantics/articleinfo:eu-repo/semantics/publishedVersionhttp://purl.org/coar/resource_type/c_6501info:ar-repo/semantics/articuloapplication/pdfapplication/pdfhttp://hdl.handle.net/11336/115722Albornoz, Facundo; Fanelli, Sebastián; Hallak, Juan Carlos; Survival in export markets; Elsevier; Journal of International Economics; 102; 9-2016; 262-2811873-03530022-1996CONICET DigitalCONICETenginfo:eu-repo/semantics/altIdentifier/url/https://linkinghub.elsevier.com/retrieve/pii/S0022199616300666info:eu-repo/semantics/altIdentifier/doi/10.1016/j.jinteco.2016.05.003info:eu-repo/semantics/openAccesshttps://creativecommons.org/licenses/by-nc-sa/2.5/ar/reponame:CONICET Digital (CONICET)instname:Consejo Nacional de Investigaciones Científicas y Técnicas2025-09-29T09:33:18Zoai:ri.conicet.gov.ar:11336/115722instacron:CONICETInstitucionalhttp://ri.conicet.gov.ar/Organismo científico-tecnológicoNo correspondehttp://ri.conicet.gov.ar/oai/requestdasensio@conicet.gov.ar; lcarlino@conicet.gov.arArgentinaNo correspondeNo correspondeNo correspondeopendoar:34982025-09-29 09:33:18.885CONICET Digital (CONICET) - Consejo Nacional de Investigaciones Científicas y Técnicasfalse |
dc.title.none.fl_str_mv |
Survival in export markets |
title |
Survival in export markets |
spellingShingle |
Survival in export markets Albornoz, Facundo EXPORT DYNAMICS FIRM HETEROGENEITY FIXED AND SUNK COSTS GEOMETRIC BROWNIAN MOTION PRODUCTIVITY SURVIVAL |
title_short |
Survival in export markets |
title_full |
Survival in export markets |
title_fullStr |
Survival in export markets |
title_full_unstemmed |
Survival in export markets |
title_sort |
Survival in export markets |
dc.creator.none.fl_str_mv |
Albornoz, Facundo Fanelli, Sebastián Hallak, Juan Carlos |
author |
Albornoz, Facundo |
author_facet |
Albornoz, Facundo Fanelli, Sebastián Hallak, Juan Carlos |
author_role |
author |
author2 |
Fanelli, Sebastián Hallak, Juan Carlos |
author2_role |
author author |
dc.subject.none.fl_str_mv |
EXPORT DYNAMICS FIRM HETEROGENEITY FIXED AND SUNK COSTS GEOMETRIC BROWNIAN MOTION PRODUCTIVITY SURVIVAL |
topic |
EXPORT DYNAMICS FIRM HETEROGENEITY FIXED AND SUNK COSTS GEOMETRIC BROWNIAN MOTION PRODUCTIVITY SURVIVAL |
purl_subject.fl_str_mv |
https://purl.org/becyt/ford/5.2 https://purl.org/becyt/ford/5 |
dc.description.none.fl_txt_mv |
This paper explores the determinants of firm survival in export markets. We build an exporter dynamics model where firms need to pay market-specific sunk and fixed costs to operate abroad and where firm export profitability in each foreign market follows a geometric Brownian motion. Firms also differ ex ante by a constant market-specific profitability shifter. We derive the probability of export survival upon entry in a market and show that it increases with the ratio of sunk to fixed costs and is insensitive to the profitability shifters. Also, we show that the survival probability is unaffected by fixed costs if sunk costs are zero. We take the model to the data using firm-level Argentine export information. We find that survival rates decrease with distance, which the model rationalizes with sunk costs that increase with distance proportionally less than fixed costs. Estimated sunk costs are small. In fact, a counterfactual exercise shows that removing those costs increases aggregate exports by less than 1.5%. Finally, we also find that survival increases with a firm's export experience. Analogously to distance, the model's implication of this empirical result is that experience reduces sunk costs proportionally less than fixed costs. Fil: Albornoz, Facundo. Consejo Nacional de Investigaciones Científicas y Técnicas; Argentina. University of Nottingham; Estados Unidos Fil: Fanelli, Sebastián. Massachusetts Institute of Technology; Estados Unidos Fil: Hallak, Juan Carlos. Consejo Nacional de Investigaciones Científicas y Técnicas; Argentina. Universidad de San Andrés; Argentina. Ministerio de Industria; Argentina |
description |
This paper explores the determinants of firm survival in export markets. We build an exporter dynamics model where firms need to pay market-specific sunk and fixed costs to operate abroad and where firm export profitability in each foreign market follows a geometric Brownian motion. Firms also differ ex ante by a constant market-specific profitability shifter. We derive the probability of export survival upon entry in a market and show that it increases with the ratio of sunk to fixed costs and is insensitive to the profitability shifters. Also, we show that the survival probability is unaffected by fixed costs if sunk costs are zero. We take the model to the data using firm-level Argentine export information. We find that survival rates decrease with distance, which the model rationalizes with sunk costs that increase with distance proportionally less than fixed costs. Estimated sunk costs are small. In fact, a counterfactual exercise shows that removing those costs increases aggregate exports by less than 1.5%. Finally, we also find that survival increases with a firm's export experience. Analogously to distance, the model's implication of this empirical result is that experience reduces sunk costs proportionally less than fixed costs. |
publishDate |
2016 |
dc.date.none.fl_str_mv |
2016-09 |
dc.type.none.fl_str_mv |
info:eu-repo/semantics/article info:eu-repo/semantics/publishedVersion http://purl.org/coar/resource_type/c_6501 info:ar-repo/semantics/articulo |
format |
article |
status_str |
publishedVersion |
dc.identifier.none.fl_str_mv |
http://hdl.handle.net/11336/115722 Albornoz, Facundo; Fanelli, Sebastián; Hallak, Juan Carlos; Survival in export markets; Elsevier; Journal of International Economics; 102; 9-2016; 262-281 1873-0353 0022-1996 CONICET Digital CONICET |
url |
http://hdl.handle.net/11336/115722 |
identifier_str_mv |
Albornoz, Facundo; Fanelli, Sebastián; Hallak, Juan Carlos; Survival in export markets; Elsevier; Journal of International Economics; 102; 9-2016; 262-281 1873-0353 0022-1996 CONICET Digital CONICET |
dc.language.none.fl_str_mv |
eng |
language |
eng |
dc.relation.none.fl_str_mv |
info:eu-repo/semantics/altIdentifier/url/https://linkinghub.elsevier.com/retrieve/pii/S0022199616300666 info:eu-repo/semantics/altIdentifier/doi/10.1016/j.jinteco.2016.05.003 |
dc.rights.none.fl_str_mv |
info:eu-repo/semantics/openAccess https://creativecommons.org/licenses/by-nc-sa/2.5/ar/ |
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openAccess |
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https://creativecommons.org/licenses/by-nc-sa/2.5/ar/ |
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application/pdf application/pdf |
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Elsevier |
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Elsevier |
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CONICET Digital (CONICET) - Consejo Nacional de Investigaciones Científicas y Técnicas |
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dasensio@conicet.gov.ar; lcarlino@conicet.gov.ar |
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13.070432 |