Open AccessThe Impact of Special Economic Zones on Exporting Behavior
Author(s) -
Ronald B. Davies,
Arman Mazhikeyev
Publication year - 2019
Publication title -
review of economic analysis
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.101
H-Index - 1
ISSN - 1973-3909
DOI - 10.15353/rea.v11i1.1520
Subject(s) - margin (machine learning) , special economic zone , value (mathematics) , economics , international economics , business , china , geography , mathematics , statistics , archaeology , machine learning , computer science
Using firm level data from Africa and Asia, we estimate the impact of being in a special economic zone (SEZ) on a firm's probability of exporting, export intensity, and value of exports. At the extensive margin, we find that SEZ firms in open economies are 25% more likely to export than their non-SEZ counterparts, with a large negative effect in closed economies. At the intensive margin, we find that SEZs increase the value of exports, but only in countries with barriers to imports where the estimate increase is 3.6%. Thus, the estimated effect of introducing an SEZ can be meaningful, but is heavily contingent on the local economic environment.