Learning to export and learning from exporting: The case of Ethiopian manufacturing
Author(s) -
Eyerusalem Siba,
Mulu Gebreeyesus
Publication year - 2016
Publication title -
journal of african economies
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.835
H-Index - 47
eISSN - 1464-3723
pISSN - 0963-8024
DOI - 10.1093/jae/ejw022
Subject(s) - sunk costs , economics , probit model , promotion (chess) , ordered probit , probit , selection (genetic algorithm) , export performance , econometrics , hysteresis , international trade , microeconomics , physics , quantum mechanics , artificial intelligence , politics , political science , computer science , law
In this study, we investigate the relationship between exporting and firm performance using a longer panel dataset of Ethiopian manufacturing firms for the period 1996−2009. We test two hypotheses regarding exporting: selection into exporting versus learning by exporting. According to the selection into exporting hypothesis, more productive firms self-select into exporting due to high entry costs. The learning by exporting hypothesis, on the other hand, emphasizes that firms learn after entering into the export market. We find evidence in support of both self-selection and learning by exporting.
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