ECONOMIES OF SCALE AND THE SIZE OF EXPORTERS | Zendy

Armenter Roc | Zendy; Koren Miklós | Zendy

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ECONOMIES OF SCALE AND THE SIZE OF EXPORTERS

Author(s) -

Armenter Roc,

Koren Miklós

Publication year - 2015

Publication title -

journal of the european economic association

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 7.792

H-Index - 93

eISSN - 1542-4774

pISSN - 1542-4766

DOI - 10.1111/jeea.12108

Subject(s) - margin (machine learning) , economies of scale , economics , productivity , market size , scale (ratio) , liberalization , international economics , monetary economics , econometrics , microeconomics , macroeconomics , market economy , physics , quantum mechanics , machine learning , computer science

How important are economies of scale in exporting? We argue that firm size cannot be the main determinant of export status if a model is to be consistent with the observed number and size of exporters. Instead, we need a lot of variation independent of firm size to reconcile the model with the data. We show that the augmented model also has markedly different implications regarding the margin of adjustment in the event of a trade liberalization: most of the adjustment is through the intensive margin and productivity gains due to reallocation are halved.

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