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Firm and destination-specific export costs: The case of the Swedish food sector

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  • Gullstrand, Joakim

Abstract

This paper focuses on sunk export costs in the Swedish food and beverage sector. Its purpose is threefold. First, it investigates whether the estimation of the importance of sunk costs is sensitive to persistence bilateral (firm-destination) effects such as specific market knowledge compared to firm-specific effects such as managerial skills or product quality. Second, it analyses the effects of firm and market characteristics on firms' export decisions. Third, it tests whether the importance of sunk costs varies with destination as well as firm characteristics. The main results are: (1) that firm-destination effects are more important than general, unobserved firm characteristics, (2) that more productive and larger firms are more likely to export and that firms' expectations from exporting increase with market size and exchange rate stability, and (3) that the importance of sunk export costs varies with firm and market characteristics.

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Bibliographic Info

Article provided by Elsevier in its journal Food Policy.

Volume (Year): 36 (2011)
Issue (Month): 2 (April)
Pages: 204-213

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Handle: RePEc:eee:jfpoli:v:36:y:2011:i:2:p:204-213

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Web page: http://www.elsevier.com/locate/foodpol

Related research

Keywords: Sunk costs of exporting Markets Export hysteresis Food and beverage;

References

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  2. Jens Matthias Arnold & Katrin Hussinger, 2003. "Export Behavior and Firm productivity in German Manufacturing. A Firm-Level Analysis," Development Working Papers 184, Centro Studi Luca d\'Agliano, University of Milano.
  3. Ruane, Frances & Sutherland, Julie, 2005. "Export Performance and Destination Characteristics of Irish Manufacturing Industry," Economics Working Papers wp05-03, School of Economics, University of Wollongong, NSW, Australia.
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Citations

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Cited by:
  1. Curzi, Daniele & Olper, Alessandro, 2012. "Export behavior of Italian food firms: Does product quality matter?," Food Policy, Elsevier, vol. 37(5), pages 493-503.
  2. Gullstrand, Joakim & Persson, Maria, 2012. "How to Combine High Sunk Costs of Exporting and Low Export Survival," Working Papers 2012:32, Lund University, Department of Economics.
  3. Gullstrand, Joakim & Olofsdotter, Karin & Thede, Susanna, 2011. "Markups and export pricing," Working Papers 2011:37, Lund University, Department of Economics.
  4. Wagner, Joachim, 2011. "Productivity and International Firm Activities: What Do We Know?," IZA Policy Papers 23, Institute for the Study of Labor (IZA).

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