Source: Unsplash, @chuttersnap

The DNA of New Exporters: Spin-Offs and FDI at the Extensive Margin of Trade

Source: Unsplash, @chuttersnap

The DNA of New Exporters: Spin-Offs and FDI at the Extensive Margin of Trade

Abstract

While new exporters account for the majority of aggregate export growth, little else is known about them. Using new data on Chilean firms, we document that aggregate export growth in Chile is driven by only a few new exporters. These exporters are new business entities, operate new plants, and behave much like experienced exporters: they start large, have high survival rates, and quickly converge to their long-term export intensity. Moreover, these new firms are owned by existing businesses and are likely the by-product of either domestic spin-offs or foreign direct investment. By focusing on the average new exporter, typically a firm previously serving the domestic market, the existing models of new exporter dynamics miss these keys features of export growth.

Publication
Working Paper
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