Advanced Search
MyIDEAS: Login

New Exports from Emerging Markets:Do Followers Beneit from Pioneers ?

Contents:

Author Info

  • Rodrigo Wagner

    ()
    (Department of Economics, Harvard University)

  • Andrés Zahler

    ()
    (Facultad de Economía y Empresa, Universidad Diego Portales)

Abstract

Since Arrow (1962), spillovers from pioneer to follower in non-excludable innovations are central to our understanding of endogenous economic growth. Nonetheless, evidence of these spillovers in less-developed economies has been elusive. Our paper contributes by showing novel facts consistent with externalities in new export products. To avoid biases towards ex-post successes, we use data on the universe of customs transactions from Chile (1990- 2006). We find that, first, follower firms are more likely to enter a product if the pioneer firm survives exporting. More importantly, we also find that pioneers enter and remain smaller than followers, which is indicative that the first exporter may not be the firm that benets the most from the discovery. This fact is inconsistent with the currently standard view in international trade, in which the largest firm would be the first willing to pay a homogeneous sunk cost of exporting. In contrast, our facts are consistent with the view that smaller pioneer exporters are data producers, whose spillovers benet larger followers. We offer a simple model to formalize this intuition, based on the idea that large exporters have more choices on how to allocate their managerial capacity. This real option makes large exporters wait, as to assign their marginal manager on the best possible project. In contrast, smaller and more focused firms prefer to be pioneers.

(This abstract was borrowed from another version of this item.)

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.udp.cl/descargas/facultades_carreras/economia/pdf/documentos_investigacion/wp18_Pioneers_Jan.pdf
Download Restriction: no

Bibliographic Info

Paper provided by Facultad de Economía y Empresa, Universidad Diego Portales in its series Working Papers with number 18.

as in new window
Length:
Date of creation: May 2011
Date of revision:
Handle: RePEc:ptl:wpaper:18

Contact details of provider:
Web page: http://www.udp.cl
More information through EDIRC

Related research

Keywords:

Other versions of this item:

Find related papers by JEL classification:

This paper has been announced in the following NEP Reports:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Eaton, Jonathan & Eslava, Marcela & Kugler, Maurice & Tybout, James, 2007. "Export Dynamics in Colombia: Firm-Level Evidence," Working Paper Series rwp07-050, Harvard University, John F. Kennedy School of Government.
  2. Gilbert, Richard J & Newbery, David M G, 1982. "Preemptive Patenting and the Persistence of Monopoly," American Economic Review, American Economic Association, vol. 72(3), pages 514-26, June.
  3. Angela da Rocha & Alexandre Darze & Beatriz Kury & Joana Monteiro, 2008. "The Emergence of New and Successful Export Activities in Brazil: Four Case Studies from the Manufacturing and the Agricultural Sector," Research Department Publications 3255, Inter-American Development Bank, Research Department.
  4. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages S71-102, October.
  5. Hausmann, Ricardo & Rodrik, Dani, 2002. "Economic Development as Self Discovery," CEPR Discussion Papers 3356, C.E.P.R. Discussion Papers.
  6. Facundo Albornoz & Hector F. Calvo Pardo & Gregory Corcos & Emanuel Ornelas, 2010. "Sequential Exporting," Discussion Papers 10-08, Department of Economics, University of Birmingham.
  7. Otto Andersen, 1993. "On the Internationalization Process of Firms: A Critical Analysis," Journal of International Business Studies, Palgrave Macmillan, vol. 24(2), pages 209-231, June.
  8. Alvarez, Roberto, 2004. "Sources of export success in small- and medium-sized enterprises: the impact of public programs," International Business Review, Elsevier, vol. 13(3), pages 383-400, June.
  9. Volker Nocke & Stephen Yeaple, 2006. "Globalization and Endogenous Firm Scope," NBER Working Papers 12322, National Bureau of Economic Research, Inc.
  10. Timothy F. Bresnahan & Shane Greenstein & Rebecca M. Henderson, 2011. "Schumpeterian Competition and Diseconomies of Scope: Illustrations from the Histories of Microsoft and IBM," NBER Chapters, in: The Rate and Direction of Inventive Activity Revisited, pages 203-271 National Bureau of Economic Research, Inc.
  11. Comin, D. & Hobijn, B., 2003. "Cross-Country Technology Adoption: Making the Theories Face the Facts," Working Papers 03-04, C.V. Starr Center for Applied Economics, New York University.
  12. Bernard, Andrew & Redding, Stephen J & Schott, Peter, 2006. "Multi-Product Firms and Product Switching," CEPR Discussion Papers 5708, C.E.P.R. Discussion Papers.
  13. Tarun Khanna & Yishay Yafeh, 2007. "Business Groups in Emerging Markets: Paragons or Parasites?," Journal of Economic Literature, American Economic Association, vol. 45(2), pages 331-372, June.
  14. Roberto Álvarez E. & Gustavo Crespi T., 2000. "Exporter performance and promotion instruments: Chilean empirical evidence," Estudios de Economia, University of Chile, Department of Economics, vol. 27(2 Year 20), pages 225-241, December.
  15. Nina Pavcnik, 2000. "Trade Liberalization, Exit, and Productivity Improvements: Evidence from Chilean Plants," NBER Working Papers 7852, National Bureau of Economic Research, Inc.
  16. Jaffe, Adam B & Trajtenberg, Manuel & Henderson, Rebecca, 1993. "Geographic Localization of Knowledge Spillovers as Evidenced by Patent Citations," The Quarterly Journal of Economics, MIT Press, vol. 108(3), pages 577-98, August.
  17. Hoff, Karla, 1997. "Bayesian learning in an infant industry model," Journal of International Economics, Elsevier, vol. 43(3-4), pages 409-436, November.
  18. Andrew D. Foster & Mark R. Rosenzweig, 2010. "Microeconomics of Technology Adoption," Annual Review of Economics, Annual Reviews, vol. 2(1), pages 395-424, 09.
  19. Peter Neary & Carsten Eckel, 2006. "Multi-Product Firms and Flexible Manufacturing in the Global Economy," Economics Series Working Papers 292, University of Oxford, Department of Economics.
  20. Tibor Besedes & Thomas Prusa, 2006. "Ins, outs, and the duration of trade," Canadian Journal of Economics, Canadian Economics Association, vol. 39(1), pages 266-295, February.
  21. Timothy J. Kehoe & Kim J. Ruhl, 2013. "How Important Is the New Goods Margin in International Trade?," Journal of Political Economy, University of Chicago Press, vol. 121(2), pages 358 - 392.
  22. Macchiavello, Rocco, 2010. "Development Uncorked: Reputation Acquisition in the New Market for Chilean Wines in the UK," CEPR Discussion Papers 7698, C.E.P.R. Discussion Papers.
  23. Jonathan Eaton & Samuel Kortum & Francis Kramarz, 2004. "Dissecting trade: firms, industries, and export destinations," Staff Report 332, Federal Reserve Bank of Minneapolis.
  24. Alvarez, Roberto & Görg, Holger, 2005. "Multinationals and Plant Exit: Evidence from Chile," IZA Discussion Papers 1611, Institute for the Study of Labor (IZA).
  25. Jonathan Eaton & Marcela Eslava & Maurice Kugler & James Tybout, . "Export Dynamics in Colombia: Transactions Level Evidence," Borradores de Economia 522, Banco de la Republica de Colombia.
  26. Timothy G. Conley & Christopher R. Udry, 2005. "Learning about a new technology: pineapple in Ghana," Proceedings, Federal Reserve Bank of San Francisco.
  27. Ann Harrison & Andrés Rodríguez-Clare, 2009. "Trade, Foreign Investment, and Industrial Policy for Developing Countries," NBER Working Papers 15261, National Bureau of Economic Research, Inc.
  28. Melitz, Marc J, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," CEPR Discussion Papers 3381, C.E.P.R. Discussion Papers.
  29. Klepper, Steven, 1996. "Entry, Exit, Growth, and Innovation over the Product Life Cycle," American Economic Review, American Economic Association, vol. 86(3), pages 562-83, June.
  30. Vandana Chandra, 2006. "Technology, Adaptation, and Exports : How Some Developing Countries Got It Right," World Bank Publications, The World Bank, number 7118, January.
  31. Justin R. Pierce & Peter K. Schott, 2009. "Concording U.S. Harmonized System Categories Over Time," NBER Working Papers 14837, National Bureau of Economic Research, Inc.
  32. Rubén Segura-Cayuela & Josep M. Vilarrubia, 2008. "Uncertainty and entry into export markets," Banco de Espa�a Working Papers 0811, Banco de Espa�a.
  33. Manuel R. Agosin & Claudio Bravo Ortega, 2009. "The Emergence of New Successful Export Activities in Latin America: The Case of Chile," IDB Publications 44838, Inter-American Development Bank.
  34. James E. Rauch & Joel Watson, 1999. "Starting Small in an Unfamiliar Environment," Cowles Foundation Discussion Papers 1218, Cowles Foundation for Research in Economics, Yale University.
  35. Costas Arkolakis, 2008. "Market Penetration Costs and the New Consumers Margin in International Trade," NBER Working Papers 14214, National Bureau of Economic Research, Inc.
  36. Gene M. Grossman & Esteban Rossi-Hansberg, 2010. "External Economies and International Trade Redux," The Quarterly Journal of Economics, MIT Press, vol. 125(2), pages 829-858, May.
  37. Besedes, Tibor & Prusa, Thomas J., 2006. "Product differentiation and duration of US import trade," Journal of International Economics, Elsevier, vol. 70(2), pages 339-358, December.
  38. Aron, Debra J & Lazear, Edward P, 1990. "The Introduction of New Products," American Economic Review, American Economic Association, vol. 80(2), pages 421-26, May.
  39. Duflo, Esther & Kremer, Michael & Robinson, Jonathan, 2009. "Nudging Farmers to Utilize Fertilizer: Theory and Experimental Evidence from Kenya," CEPR Discussion Papers 7402, C.E.P.R. Discussion Papers.
  40. repec:stn:sotoec:1003 is not listed on IDEAS
  41. Esther Duflo & Michael Kremer & Jonathan Robinson, 2009. "Nudging Farmers to Use Fertilizer: Theory and Experimental Evidence from Kenya," NBER Working Papers 15131, National Bureau of Economic Research, Inc.
  42. Roberto Alvarez & Ricardo López, 2005. "Exporting and performance: evidence from Chilean plants," Canadian Journal of Economics, Canadian Economics Association, vol. 38(4), pages 1384-1400, November.
  43. Amsden, Alice H., 1992. "Asia's Next Giant: South Korea and Late Industrialization," OUP Catalogue, Oxford University Press, number 9780195076035.
  44. Luis E Lopez & Sumit K Kundu & Luciano Ciravegna, 2009. "Born global or born regional? Evidence from an exploratory study in the Costa Rican software industry," Journal of International Business Studies, Palgrave Macmillan, vol. 40(7), pages 1228-1238, September.
  45. Jonathan L. Willis & Kim J. Ruhl, 2009. "New Exporter Dynamics," 2009 Meeting Papers 111, Society for Economic Dynamics.
  46. Prusa, Thomas J & Schmitz, James A, Jr, 1994. "Can Companies Maintain Their Initial Innovation Thrust? A Study of the PC Software Industry," The Review of Economics and Statistics, MIT Press, vol. 76(3), pages 523-40, August.
  47. Hopenhayn, Hugo A, 1992. "Entry, Exit, and Firm Dynamics in Long Run Equilibrium," Econometrica, Econometric Society, vol. 60(5), pages 1127-50, September.
  48. C. A. Hidalgo & B. Klinger & A. -L. Barabasi & R. Hausmann, 2007. "The Product Space Conditions the Development of Nations," Papers 0708.2090, arXiv.org.
  49. Leonardo Iacovone & BeataS. Javorcik, 2010. "Multi-Product Exporters: Product Churning, Uncertainty and Export Discoveries," Economic Journal, Royal Economic Society, vol. 120(544), pages 481-499, 05.
  50. Freund, Caroline & Pierola, Martha Denisse, 2010. "Export entrepreneurs : evidence from Peru," Policy Research Working Paper Series 5407, The World Bank.
  51. Alvarez, Roberto, 2007. "Explaining Export Success: Firm Characteristics and Spillover Effects," World Development, Elsevier, vol. 35(3), pages 377-393, March.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as in new window

Cited by:
  1. Enrique Moral-Benito, 2013. "Agglomeration Matters for Trade," 2013 Meeting Papers 85, Society for Economic Dynamics.
  2. Cebeci, Tolga & Fernandes, Ana M. & Freund, Caroline & Pierola, Martha Denisse, 2012. "Exporter dynamics database," Policy Research Working Paper Series 6229, The World Bank.
  3. Stirbat, Liviu & Record, Richard & Nghardsaysone, Konesawang, 2013. "Determinants of export survival in the Lao PDR," Policy Research Working Paper Series 6301, The World Bank.
  4. Tomasz Serwach, 2012. "Why Learning by Exporting May Not Be As Common As You Think and What It Means for Policy," International Journal of Management, Knowledge and Learning, International School for Social and Business Studies, Celje, Slovenia, vol. 1(2), pages 157-172.

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ptl:wpaper:18. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Enrique Calfucura).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.