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Do Export Promotion Agencies Increase Exports?

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  • Kazunobu Hayakawa
  • Hyun-Hoon Lee
  • Donghyun Park

Abstract

type="main"> In this paper, we examine the role of export promotion agencies (EPAs) in promoting exports from Japan and Korea. Looking at two home countries enables us to tackle endogeneity issues by controlling for both country-pair time-invariant characteristics and importing-country time-varying characteristics. Our empirical results indicate that EPA has a positive and significant effect on exports even when we control for endogeneity. However, the size of the effect becomes substantially smaller, implying the importance of addressing endogeneity in accurately measuring the impact of EPA on exports. In addition, we find that EPA's (marginal) effects are larger in exporting to low-income trade partners than in exporting to high-income trade partners.

Suggested Citation

  • Kazunobu Hayakawa & Hyun-Hoon Lee & Donghyun Park, 2014. "Do Export Promotion Agencies Increase Exports?," The Developing Economies, Institute of Developing Economies, vol. 52(3), pages 241-261, September.
    • Handle: RePEc:bla:deveco:v:52:y:2014:i:3:p:241-261
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    2. Srhoj, Stjepan & Vitezic, Vanja & Wagner, Joachim, 2020. "Export boosting policies and firm behaviour: Review of empirical evidence around the world," MPRA Paper 104330, University Library of Munich, Germany.
    3. Vargas Da Cruz,Marcio Jose, 2014. "Do export promotion agencies promote new exporters ?," Policy Research Working Paper Series 7004, The World Bank.
    4. (ed.), 0. "Research Handbook on Economic Diplomacy," Books, Edward Elgar Publishing, number 16053.
    5. Ryo Makioka, 2021. "The impact of export promotion with matchmaking on exports and service outsourcing," Review of International Economics, Wiley Blackwell, vol. 29(5), pages 1418-1450, November.
    6. Demena, B.A., 2021. "Effectiveness of export promotion programmes," ISS Working Papers - General Series 688, International Institute of Social Studies of Erasmus University Rotterdam (ISS), The Hague.
    7. Jaime DE MELO & Marcelo OLARREAGA, 2017. "Trade Related Institutions and Development," Working Papers P199, FERDI.
    8. Aalto, Eero & Gustafsson, Robin, 2020. "Export Promotion Rationales and Impacts – A Review," ETLA Reports 100, The Research Institute of the Finnish Economy.
    9. Selwyn J. V. Moons & Peter A. G. Bergeijk, 2017. "Does Economic Diplomacy Work? A Meta-analysis of Its Impact on Trade and Investment," The World Economy, Wiley Blackwell, vol. 40(2), pages 336-368, February.

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    More about this item

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

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