IDEAS home Printed from https://ideas.repec.org/a/wly/agribz/v18y2002i4p523-541.html
   My bibliography  Save this article

Minimum effective scale in export promotion

Author

Listed:
  • Timothy J. Richards

    (Arizona State University East, Morrison School of Agribusiness and Resource Management, Mail Code 0180, 7001 East Williams Field Road, Bldg. 20, Mesa, AZ 85212. E-mail: trichards@asu.edu)

  • Paul M. Patterson

    (Arizona State University East, Morrison School of Agribusiness and Resource Management, Mail Code 0180, 7001 East Williams Field Road, Bldg. 20, Mesa, AZ 85212. E-mail: trichards@asu.edu)

Abstract

Nonprice promotion has long been used by small firms or organizations to increase agricultural exports. Some believe that export promotion in these cases is often unsuccessful as the promoter is unable to achieve the “critical mass” of awareness that is required for success. The objective of this article is to develop a theoretical explanation for the likely existence of minimum expenditure thresholds and to estimate their size using an econometric model of the optimal supply of advertising. An empirical example of apple promotion from Washington state (USA) finds minimum effective scale levels for four key promotion activities among several Latin American countries.[EconLit citations: C34, M37, Q17]. © 2002 Wiley Periodicals, Inc.

Suggested Citation

  • Timothy J. Richards & Paul M. Patterson, 2002. "Minimum effective scale in export promotion," Agribusiness, John Wiley & Sons, Ltd., vol. 18(4), pages 523-541.
    • Handle: RePEc:wly:agribz:v:18:y:2002:i:4:p:523-541
    DOI: 10.1002/agr.10036
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1002/agr.10036
    File Function: Link to full text; subscription required
    Download Restriction: no
    File URL: https://libkey.io/10.1002/agr.10036?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Davidson, Russell & MacKinnon, James G, 1981. "Several Tests for Model Specification in the Presence of Alternative Hypotheses," Econometrica, Econometric Society, vol. 49(3), pages 781-793, May.
    2. Kinnucan, Henry W. & Xiao, Hui & Yu, Shixue, 2000. "Relative Effectiveness Of Usda'S Nonprice Export Promotion Instruments," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 25(2), pages 1-19, December.
    3. Richard Baldwin & Paul Krugman, 1989. "Persistent Trade Effects of Large Exchange Rate Shocks," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 104(4), pages 635-654.
    4. Timothy J. Richards & Pieter. Van Ispelen & Albert Kagan, 1997. "A Two-Stage Analysis of the Effectiveness of Promotion Programs for U.S. Apples," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(3), pages 825-837.
    5. Richard W. Blundell & Richard J. Smith, 1989. "Estimation in a Class of Simultaneous Equation Limited Dependent Variable Models," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 56(1), pages 37-57.
    6. H. Solomon & Henry W. Kinnucan, 1993. "Effects Of Non‐Price Export Promotion: Some Evidence For Cotton," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 37(1), pages 1-15, April.
    7. Avinash Dixit, 1992. "Investment and Hysteresis," Journal of Economic Perspectives, American Economic Association, vol. 6(1), pages 107-132, Winter.
    8. Azzeddine M. Azzam, 1999. "Asymmetry and Rigidity in Farm-Retail Price Transmission," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 81(3), pages 525-533.
    9. Stigler, George J & Becker, Gary S, 1977. "De Gustibus Non Est Disputandum," American Economic Review, American Economic Association, vol. 67(2), pages 76-90, March.
    10. Ehrlich, Isaac & Fisher, Lawrence, 1982. "The Derived Demand for Advertising: A Theoretical and Empirical Investigation," American Economic Review, American Economic Association, vol. 72(3), pages 366-388, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Lee, In Hyeock & Rugman, Alan M., 2012. "Firm-specific advantages, inward FDI origins, and performance of multinational enterprises," Journal of International Management, Elsevier, vol. 18(2), pages 132-146.
    2. Henry Kinnucan & Øystein Myrland, 2008. "On generic vs. brand promotion of farm products in foreign markets," Applied Economics, Taylor & Francis Journals, vol. 40(6), pages 673-684.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Richards, Timothy J. & Patterson, Paul M., 1998. "Dynamic Complementarity In Export Promotion: The Market Access Program In Fruits And Vegetables," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 23(2), pages 1-19, December.
    2. Richards, Timothy J. & Patterson, Paul M., 1998. "New Varieties and the Returns to Commodity Promotion: Washington Fuji Apples," Working Papers 28541, Arizona State University, Morrison School of Agribusiness and Resource Management.
    3. Troske, Kenneth R, 1996. "The Dynamic Adjustment Process of Firm Entry and Exit in Manufacturing and Finance, Insurance, and Real Estate," Journal of Law and Economics, University of Chicago Press, vol. 39(2), pages 705-735, October.
    4. Bruno Amable & Jerome Henry & Frederic Lordon & Richard Topol, 2004. "Complex Remanence vs. Simple Persistence: Are Hysteresis and Unit-Root Processes Observationally Equivalent?," International Symposia in Economic Theory and Econometrics, in: Economic Complexity, pages 67-89, Emerald Group Publishing Limited.
    5. J. A. L. Cranfield, 2003. "Optimal Collective Investment in Generic Advertising, Export Market Promotion and Cost-of-Production-Reducing Research," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 51(3), pages 299-321, November.
    6. Q.Farooq Akram & Øyvind Eitrheim & Lucio Sarno, 2006. "Non-linear Dynamics in Output, Real Exchange Rates and Real Money Balances: Norway, 1830-2003," Contributions to Economic Analysis, in: Nonlinear Time Series Analysis of Business Cycles, pages 333-377, Emerald Group Publishing Limited.
    7. Barham, Bradford L. & Chavas, Jean-Paul, 1997. "Sunk Costs and Resource Mobility: Implications for Economic and Policy Analysis," 1997 Conference, August 10-16, 1997, Sacramento, California 197060, International Association of Agricultural Economists.
    8. Campbell, Douglas L., 2020. "Relative Prices and Hysteresis: Evidence from US Manufacturing," European Economic Review, Elsevier, vol. 129(C).
    9. Moura, Guilherme V. & Richard, Jean-François & Liesenfeld, Roman, 2007. "Dynamic Panel Probit Models for Current Account Reversals and their Efficient Estimation," Economics Working Papers 2007-11, Christian-Albrechts-University of Kiel, Department of Economics.
    10. Stephan Nuesch & Egon Franck, 2009. "The Role of Patriotism in Explaining the TV Audience of National Team Games—Evidence From Four International Tournaments," Journal of Media Economics, Taylor & Francis Journals, vol. 22(1), pages 6-19.
    11. Koray Yıldırım & Neşe Algan & Harun Bal, 2024. "Investment Hysteresis: An Empirical Essay Turkish Case," Evaluation Review, , vol. 48(1), pages 143-176, February.
    12. Campa, Jose Manuel, 2004. "Exchange rates and trade: How important is hysteresis in trade?," European Economic Review, Elsevier, vol. 48(3), pages 527-548, June.
    13. Jolita Adamonis & Matthias Göcke, 2019. "Modelling economic hysteresis losses caused by sunk adjustment costs," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 42(2), pages 299-318, April.
    14. Digal, Larry N. & Ahmadi-Esfahani, Fredoun Z., 2002. "Market power analysis in the retail food industry: a survey of methods," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 46(4), pages 1-26.
    15. Song, Sangcheol, 2015. "Exchange rate challenges, flexible intra-firm adjustments, and subsidiary longevity," Journal of World Business, Elsevier, vol. 50(1), pages 36-45.
    16. Xulia González & Jordi Jaumandreu, "undated". "Threshold effects in product R&D decisions: theoretical framework and empirical analysis," Studies on the Spanish Economy 45, FEDEA.
    17. Arjen van Witteloostuijn, 1998. "Bridging Behavioral and Economic Theories of Decline: Organizational Inertia, Strategic Competition, and Chronic Failure," Management Science, INFORMS, vol. 44(4), pages 501-519, April.
    18. Manitra Rakotoarisoa, 2007. "Explaining Durations in Country Investment Ratings: A Competing Risk Model with Random-Effects," EcoMod2007 23900074, EcoMod.
    19. Daisuke Oyama, 2004. "Booms And Slumps In A Game Of Sequential Investment With The Changing Fundamentals," The Japanese Economic Review, Japanese Economic Association, vol. 55(3), pages 311-320, September.
    20. Váry, Miklós, 2018. "A hiszterézis közgazdasági jelentőségéről posztkeynesi szemléletben [The economic relevance of hysteresis from a post-Keynesian perspective]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(10), pages 1006-1047.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:wly:agribz:v:18:y:2002:i:4:p:523-541. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1520-6297 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.