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Capacity Building as a Route to Export Market Expansion : A Six-Country Experiment in theWestern Balkans∗

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  • Cusolito,Ana Paula
  • Darova,Ornella
  • Mckenzie,David J.

Abstract

The limited market size of many small emerging economies is a key constraint to the growth ofinnovative small and medium enterprises. Exporting offers a potential solution, but firms may struggle to locate andappeal to foreign buyers. A six-country randomized experiment was conducted with 225 firms in the WesternBalkans to test the effectiveness of 30 hours of live group-based training and 5 hours of one-on-one remoteconsulting in overcoming these constraints. Treated firms used techniques such as search engine optimization andimproved Facebook content to increase their digital presence and better reach foreign customers. A year later, positiveand significant impacts are found on the number of customers, and a significant intensive margin increase inexport sales. Qualitative interviews suggest this improvement came from a combination of sector-specificadvice on market expansion, and through an encouragement effect which gave entrepreneurs the confidence to try newsales strategies.

Suggested Citation

  • Cusolito,Ana Paula & Darova,Ornella & Mckenzie,David J., 2022. "Capacity Building as a Route to Export Market Expansion : A Six-Country Experiment in theWestern Balkans∗," Policy Research Working Paper Series 10256, The World Bank.
  • Handle: RePEc:wbk:wbrwps:10256
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