סמינר באסטרטגיה
How Exporters Grow
Yaniv Yedid-Levi, Vancouver School of Economics, University of British Columbia
Abstract:
We use customs microdata to distinguish between competing models of demand and customer base.
We purge supply-side variation from the data by comparing quantities and prices across markets within a firm.
Higher quantities on entry forecast survival in an export market, but survival is unrelated to initial prices.
Conditioning on survival, there is economically and statistically significant growth of quantities within a firm-market, but no dynamics of prices.
These facts are consistent with a model of the demand side of firm growth where entrants to a market learn about idiosyncratic demand through quantities, generating selective exit, while survivors grow by accumulating customer base through marketing and advertising.
They present a challenge to models where firms learn about idiosyncratic demand through prices, and to models where current demand depends on lagged sales.