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

  • Gullstrand, Joakim

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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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
Contact details of provider: Web page: http://www.elsevier.com/locate/foodpol

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  22. WenShwo Fang & YiHao Lai & Stephen M. Miller, 2006. "Export Promotion through Exchange Rate Changes: Exchange Rate Depreciation or Stabilization," Southern Economic Journal, Southern Economic Association, vol. 72(3), pages 611-626, January.
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