Exports, Investment and Production Growth: A Dynamic Heterogeneous Firm Model with Learning and Entry Costs

25 Pages Posted: 25 Aug 2019

See all articles by Ruohan Wu

Ruohan Wu

University of North Georgia

Mario Miranda

Ohio State University (OSU) - Department of Agricultural, Environmental & Development Economics

Date Written: April 1, 2014

Abstract

We analyze a fi rm's joint decision to export and invest using a model that incorporates the essential features of self-selection and learning-by-exporting theories of fi rm-level dynamics. We calibrate the model to 2002-07 Chilean manufacturing plant data and simulate it under different assumptions, finding that neither self-selection nor learning-by-exporting alone can adequately explain the observed cross-sectional relationship between firm level exports and capital, favoring instead a model that allows both mechanisms to work in tandem.

Keywords: Exports; Investment; Self-Selection; Learning-by-Exporting; Heterogeneity

JEL Classification: C63; F11; F17; O32

Suggested Citation

Wu, Ruohan and Miranda, Mario, Exports, Investment and Production Growth: A Dynamic Heterogeneous Firm Model with Learning and Entry Costs (April 1, 2014). Available at SSRN: https://ssrn.com/abstract=3435874 or http://dx.doi.org/10.2139/ssrn.3435874

Ruohan Wu (Contact Author)

University of North Georgia ( email )

82 College Cir
Dahlonega, GA 30597
United States

Mario Miranda

Ohio State University (OSU) - Department of Agricultural, Environmental & Development Economics ( email )

2120 Fyffe Rd
Columbus, OH 43210-1067
United States

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