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The Role Of Uncertainty For Export Survival: Evidence From Estonia

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  • Siim Rahu

Abstract

Export growth requires not only entry into new markets, but also the survival of trade flows. This paper analyses the role of initial product export share and product differentiation in Estonian manufacturing export survival. For this purpose, detailed firm-product-destination level export data is used from 1995–2011. The data show that adding and dropping new products is rife, about half of the firms change their export portfolio annually, but the average export flow duration remains modest at two years and the median even less. The Cox proportional hazards model reveals in various settings that survival is better if the initial export share is larger and exports are more differentiated. Previous experience with foreign markets and different products has a positive impact on survival. Policies aimed at increasing knowledge about foreign markets are supporting export success.

Suggested Citation

  • Siim Rahu, 2015. "The Role Of Uncertainty For Export Survival: Evidence From Estonia," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 97, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    • Handle: RePEc:mtk:febawb:97
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    References listed on IDEAS

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    Cited by:

    1. Wagner, Joachim, 2018. "Temporary exports and characteristics of destination countries: First evidence from German transaction data," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 12, pages 1-12.
    2. Joachim Wagner, 2016. "A survey of empirical studies using transaction level data on exports and imports," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 152(1), pages 215-225, February.
    3. Trąpczyński Piotr, 2018. "Opening the “Black Box” of Firm De-internationalisation Processes: What Should We Still Know?," Journal of Intercultural Management, Sciendo, vol. 10(1), pages 143-171, March.
    4. Lawless, Martina & Siedschlag, Iulia & Studnicka, Zuzanna, 2017. "Expanding and diversifying the manufactured exports of Irish-owned enterprises," Research Series, Economic and Social Research Institute (ESRI), number BKMNEXT335.

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    More about this item

    Keywords

    export survival; product level; Estonian manufacturing; Cox model;
    All these keywords.

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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