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Learning from Neighbors' Export Activities: Evidence from Exporters' Survival


  • Ana Fernandes
  • Heiwai Tang


Recent studies in international trade report that new exporters often start selling small amounts and cease exporting in the first year. These findings reflect a substantial amount of uncertainty facing new exporters. In this paper we study whether export activities in the neighborhood reveal information about export profitability and thus enhance new exporters' performance. Using transaction-level data for the universe of exporters in China over the period of 2001-2005, we find that new exporters; first-year sales and probability of survival are both higher in cities where there are more existing export activities in the same market (industry or destination country). Export activities in other markets do not generate any positive spillovers, and in some cases we find negative spillovers. Spillovers from processing exporters are weaker. Foreign exporters benefit less from neighboring export activities. The relaion between the magnitude of spillovers and the proxies for demand uncertainty is non-monotonic. We empirically verify that our findings are unlikely to be spurious or resulted from spillovers through the credit- constraint or the imported-material channels.

Suggested Citation

  • Ana Fernandes & Heiwai Tang, 2012. "Learning from Neighbors' Export Activities: Evidence from Exporters' Survival," Discussion Papers Series, Department of Economics, Tufts University 0766, Department of Economics, Tufts University.
  • Handle: RePEc:tuf:tuftec:0766

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    References listed on IDEAS

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    Cited by:

    1. Wei, Shang-Jin & Wei, Ziru & Xu, Jianhuan, 2014. "Assessing Market Failures in Export Pioneering Activities: A Structural Estimation Approach," CEPR Discussion Papers 10187, C.E.P.R. Discussion Papers.
    2. Kamal, Fariha & Sundaram, Asha, 2016. "Buyer–seller relationships in international trade: Do your neighbors matter?," Journal of International Economics, Elsevier, vol. 102(C), pages 128-140.
    3. N. Berman & V. Rebeyrol & V. Vicard, 2015. "Demand learning and firm dynamics: evidence from exporters," Working papers 551, Banque de France.
    4. Wang, Jin, 2013. "The economic impact of Special Economic Zones: Evidence from Chinese municipalities," Journal of Development Economics, Elsevier, vol. 101(C), pages 133-147.

    More about this item


    Knowledge spillovers; uncertainty; export dynamics; multi-product exporters.;

    JEL classification:

    • F1 - International Economics - - Trade
    • F2 - International Economics - - International Factor Movements and International Business

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