Portal de Periódicos da CAPES

Sequential exporting

2012; Elsevier BV; Volume: 88; Issue: 1 Linguagem: Inglês

10.1016/j.jinteco.2012.02.007

1873-0353

Facundo Albornoz, Hector Calvo-Pardo, Grégory Corcos, Emanuel Ornelas,

Firm Innovation and Growth

Many new exporters give up exporting very shortly, despite substantial entry costs; others shoot up foreign sales and expand to new destinations. We develop a model based on experimentation to rationalize these and other dynamic patterns of exporting firms. We posit that individual export profitability, while initially uncertain, is positively correlated over time and across destinations. This leads to “sequential exporting,” where the possibility of profitable expansion at the intensive and extensive margins makes initial entry costs worthwhile despite high failure rates. Firm-level evidence from Argentina's customs, which would be difficult to reconcile with existing models, strongly supports this mechanism.