Is Export Promotion Effective in Developing Countries? Firm-Level Evidence on the Intensive and Extensive Margins of Exports
Peer Reviewed
Date issued
Aug 2010
Subject
Trade Facilitation;
Business Development
JEL code
C23 - Panel Data Models • Spatio-temporal Models;
F13 - Trade Policy • International Trade Organizations;
F14 - Empirical Studies of Trade;
L15 - Information and Product Quality • Standardization and Compatibility;
L25 - Firm Performance: Size, Diversification, and Scope;
O17 - Formal and Informal Sectors • Shadow Economy • Institutional Arrangements;
O24 - Trade Policy • Factor Movement Policy • Foreign Exchange Policy
Country
Peru
Category
Working Papers
How effective are export promotion activities in developing countries? What are the channels through which export promotion affects firms' exports, the intensive margin or the extensive margin? Empirical evidence in this respect is scarce. We aim at filling this gap in the literature by providing evidence on the impact of export promotion on export performance using a unique firm-level dataset for Peru over the period 2001-2005. We find that export promotion actions are associated with increased exports, primarily along the extensive margin, both in terms of markets and products. This result is robust across alternative specifications and estimation methods.
