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Does the Past Performance in Home Market Affect Export Participation of New Exporters? Evidence from Indian Firms

In: Trade, Investment and Economic Growth

Author

Listed:
  • Priyanta Ghosh

    (University of Gour Banga)

  • Aparna Sawhney

    (Jawaharlal Nehru University)

Abstract

This paper analyses the role of a firm’s home market performance in its export entry decision for Indian manufacturing firms during the period 2000–2014. Classifying firms under three broad categories of new exporters, incumbent exporters and non-exporters, we show that new exporters, as well as incumbent exporters, are bigger and more productive compared to non-exporters. Comparing between exporters, we find that new exporters are bigger than incumbent exporters, but not different in terms of factor productivity. Using longitudinal micro-level data, we estimate a random effect probit model to test for the significance of the home market performance on firm export behaviour for new exporters vis-à-vis non-exporters. We find that home market performance enhances export behaviour, and firms with higher growth rate in the home market are more likely to enter the export market in future.

Suggested Citation

  • Priyanta Ghosh & Aparna Sawhney, 2021. "Does the Past Performance in Home Market Affect Export Participation of New Exporters? Evidence from Indian Firms," Springer Books, in: Pooja Lakhanpal & Jaydeep Mukherjee & Biswajit Nag & Divya Tuteja (ed.), Trade, Investment and Economic Growth, chapter 0, pages 23-36, Springer.
    • Handle: RePEc:spr:sprchp:978-981-33-6973-3_2
    DOI: 10.1007/978-981-33-6973-3_2
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