Pure Exporter: Theory and Evidence

20 Pages Posted: 28 Apr 2011 Last revised: 14 May 2012

See all articles by Jiangyong Lu

Jiangyong Lu

Peking University

Yi Lu

National University of Singapore (NUS) - Department of Economics

Zhigang Tao

The University of Hong Kong - School of Business

Date Written: March 2011

Abstract

This paper provides the first evidence about pure exporters (i.e., firms exporting all of their output to the foreign market) -- a phenomenon overlooked and cannot be explained in the existing literature. It then offers a generalized model of Melitz (2003) for examining the existence and behavior of pure exporters. In particular, pure exporters arise when the export market is sufficiently large -- a situation more likely to hold in developing countries as opposed to large developed countries; and their productivity levels are above those of non-exporters, but below those of firms having both domestic sales and export. These theoretical predictions are borne out in a data of Chinese manufacturing firms for the period of 1998-2005.

Keywords: Pure Exporter, Firm Heterogeneity, Exporting Behavior

JEL Classification: F12, F23, L22, D24

Suggested Citation

Lu, Jiangyong and Lu, Yi and Tao, Zhigang, Pure Exporter: Theory and Evidence (March 2011). Available at SSRN: https://ssrn.com/abstract=1824935 or http://dx.doi.org/10.2139/ssrn.1824935

Jiangyong Lu

Peking University ( email )

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Yi Lu (Contact Author)

National University of Singapore (NUS) - Department of Economics ( email )

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Zhigang Tao

The University of Hong Kong - School of Business ( email )

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Hong Kong
China
(852) 2857-8223 (Phone)
(852) 2858-5614 (Fax)

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