How Exporters Grow (Job Talk)

Speaker
Yaniv Yedid-Levi
Date
11/12/2017 - 12:30 - 11:10Add To Calendar 2017-12-11 11:10:00 2017-12-11 12:30:00 How Exporters Grow (Job Talk) 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 Building 504 (Economics), seminar room 011 אוניברסיטת בר-אילן - Department of Economics Economics.Dept@mail.biu.ac.il Asia/Jerusalem public
Place
Building 504 (Economics), seminar room 011
Affiliation
U. 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

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Last Updated Date : 02/12/2017