The Origins and Dynamics of Export Superstars

19 Pages Posted: 17 Oct 2016

See all articles by Caroline Freund

Caroline Freund

Peter G. Peterson Institute for International Economics

Martha Denisse Pierola

World Bank - Development Research Group (DECRG)

Date Written: October 2016

Abstract

This paper uses firm-level data on manufacturing trade from 40 developing countries to explore how the five largest exporters in a country contribute to export growth and diversification. The origins of these firms are also studied. The data show that the top five exporters account for on average one third of exports, over half of export growth, and almost all of export diversification over a five-year period. Controlling for country and industry-fixed effects, the share of exports in the top five firms increases significantly as exports grow. Most top five exporters were already large five years ago or are new firms; it is extremely rare for these export super- stars to emerge from the bottom half of the firm-size distribution. They are producers, not traders, and are primarily foreign owned.

Keywords: firm size distribution, power law, comparative advantage, export growth

JEL Classification: D22, L11, L25, F14

Suggested Citation

Freund, Caroline and Pierola, Martha Denisse, The Origins and Dynamics of Export Superstars (October 2016). Peterson Institute for International Economics Working Paper No. 16-11. Available at SSRN: https://ssrn.com/abstract=2852479 or http://dx.doi.org/10.2139/ssrn.2852479

Caroline Freund (Contact Author)

Peter G. Peterson Institute for International Economics ( email )

1750 Massachusetts Avenue, NW
Washington, DC 20036
United States

Martha Denisse Pierola

World Bank - Development Research Group (DECRG) ( email )

1818 H. Street N.W.
MSN3-311
Washington, DC 20433
United States

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