Export Diversification: What's Behind the Hump?

49 Pages Posted: 6 Jun 2008

See all articles by Olivier Cadot

Olivier Cadot

University of Lausanne - School of Economics and Business Administration (HEC-Lausanne); Centre for Economic Policy Research (CEPR); World Bank

Céline Carrère

University of Geneva

Vanessa Strauss-Kahn

INSEAD - Economics and Political Sciences

Multiple version iconThere are 2 versions of this paper

Date Written: November 2007

Abstract

The paper explores the evolution of export diversification patterns along the economic development path. Using a large database with 159 countries over 17 years at the HS6 level of disaggregation (4'998 product lines) we look for action at the "intensive" and "extensive" margins (diversification of export values among active product lines and by addition of new product lines respectively) using various export concentration indices and the number of active export lines. We also look at new product introduction as an indicator of "export-entrepreneurship". We find a hump-shaped pattern of export diversification similar to what Imbs and Wacziarg (2003) found for production and employment. Low and Middle income countries diversify mostly along the extensive margin whereas high income countries diversify along the intensive margin and ultimately re-concentrate their exports towards fewer products. Such hump-shaped pattern is consistent with the conjecture that countries travel across diversification cones as discussed in Schott (2003, 2004) and Xiang (2007).

Keywords: Export diversification, International trade, Latin America

JEL Classification: F1, O11

Suggested Citation

Cadot, Olivier and Carrère, Céline and Strauss-Kahn, Vanessa, Export Diversification: What's Behind the Hump? (November 2007). CEPR Discussion Paper No. DP6590, Available at SSRN: https://ssrn.com/abstract=1140519

Olivier Cadot (Contact Author)

University of Lausanne - School of Economics and Business Administration (HEC-Lausanne) ( email )

Unil Dorigny, Batiment Internef
Lausanne, 1015
Switzerland
+41 21 692 3463 (Phone)
+41 21 692 3495 (Fax)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

World Bank ( email )

1818 H Street NW
Washington, DC 20433
United States

Céline Carrère

University of Geneva ( email )

102 Bd Carl-Vogt
Genève, CH - 1205
Switzerland

Vanessa Strauss-Kahn

INSEAD - Economics and Political Sciences ( email )

Boulevard de Constance
F-77305 Fontainebleau Cedex
France
+33 1 6072 4239 (Phone)

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
7
Abstract Views
770
PlumX Metrics