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Exporting from a small landlocked economy : an assessment of firm-product-destination survival rates in the Lao PDR

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  • Stirbat, Liviu
  • Record, Richard
  • Nghardsaysone, Konesawang

Abstract

This paper analyzes previously unreleased firm-level customs transaction data from the Lao PDR in order to assess the determinants of cohort survival among exporters. The authors find that export flows in value terms are dominated by the intensive margin, with large firms continuing to supply the same products to the same markets. On the extensive margin, new export spells for firms, products and firm-product-destination units are very small and short-lived, suggesting that although there is significant experimentation and discovery by firms, there is only limited capacity to stay in markets once an entry is made. Regression analyses of the factors that influence survival past the first year reveal that this is positively correlated with the initial dollar value (starting big makes a difference) and is helped by the firm's experience with the product and the destination, but hindered by a lack of focus. Agglomeration of exporters in the same destination with the same product is beneficial, an effect analogous to external economies of scale. The authors conclude by recommending that the focus of export promotion activity should be on helping existing exporters find and stay in new markets.

Suggested Citation

  • Stirbat, Liviu & Record, Richard & Nghardsaysone, Konesawang, 2011. "Exporting from a small landlocked economy : an assessment of firm-product-destination survival rates in the Lao PDR," Policy Research Working Paper Series 5695, The World Bank.
  • Handle: RePEc:wbk:wbrwps:5695
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    References listed on IDEAS

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    Cited by:

    1. Stirbat, Liviu & Record, Richard & Nghardsaysone, Konesawang, 2013. "Determinants of export survival in the Lao PDR," Policy Research Working Paper Series 6301, The World Bank.
    2. Damilola Felix Arawomo, 2015. "Survival of Nigeria's Exports in Her Biggest Markets: Continuous and Discrete Time Estimations," Economics Bulletin, AccessEcon, vol. 35(3), pages 1700-1708.
    3. Lord, Montague & Artuso, Fabio & Record, Richard & Clarke, Julian, 2014. "Trading Costs in East Asia’s Global Value Chains," MPRA Paper 66437, University Library of Munich, Germany.
    4. Evelyn S. Devadason & Santha Chenayah, 2014. "Proliferation Of Non-Tariff Measures In China — Their Relevance For Asean," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 59(02), pages 1-28.
    5. Stirbat, Liviu & Record, Richard & Nghardsaysone, Konesawang, 2015. "The Experience of Survival: Determinants of Export Survival in Lao PDR," World Development, Elsevier, vol. 76(C), pages 82-94.
    6. Syden Mishi & Weliswa Matekenya & Leward Jeke & Ronney M. Ncwadi & Roseline T. Karambakuwa, 2021. "Firm and product survival analysis: Evidence from South African tax administrative and products data," WIDER Working Paper Series wp-2021-107, World Institute for Development Economic Research (UNU-WIDER).
    7. Sithanonxay Suvannaphakdy & Alisa DiCaprio, 2021. "Are Asian least developed countries sidelined in advanced manufacturing production networks?," Asian-Pacific Economic Literature, Asia Pacific School of Economics and Government, The Australian National University, vol. 35(1), pages 134-152, May.

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    Keywords

    Markets and Market Access; Microfinance; E-Business; Economic Theory&Research; Water and Industry;
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