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Domestic transport infrastructure and firms’ export market participation

  • Pedro Albarran


  • Raquel Carrasco


  • Adelheid Holl


Investment in transport infrastructure reduces the cost of distance and enables firms to establish contacts over larger distances. Using data from a panel of Spanish manufacturing firms and geographic information system techniques, this article studies the impact of domestic transport cost reductions on firms’ export market participation, taking into account the role of entry costs and other firm characteristics. We estimate dynamic probability models, controlling for the unobserved heterogeneity of firms and for the simultaneity of firms’ export and location decisions. Our results demonstrate a positive effect of domestic transport infrastructure improvements on small and medium-sized firms’ probability of exporting. Copyright Springer Science+Business Media, LLC. 2013

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Article provided by Springer in its journal Small Business Economics.

Volume (Year): 40 (2013)
Issue (Month): 4 (May)
Pages: 879-898

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Handle: RePEc:kap:sbusec:v:40:y:2013:i:4:p:879-898
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