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Entry and Exit in International Markets: Evidence from Chilean Data

34 Pages Posted: 16 Feb 2005  

Roberto Alvarez

University of Chile - Department of Economics

Ricardo A. López

Brandeis International Business School

Multiple version iconThere are 2 versions of this paper

Date Written: September 29, 2006

Abstract

Several studies examine the patterns and determinants of entry and exit in manufacturing industries. Not much work exists on entry and exit in international markets. This paper uses Chilean data to analyze the determinants of entry and exit in and out of export markets. We find that entry and exit rates differ across industries; vary over time; and are positively correlated. The econometric analysis shows that within-industry heterogeneity, measured by differences in productivity or other firm characteristics, has a significant effect on plant turnover in international markets. Our findings reveal that trade costs, factor intensities, and fluctuations in the real exchange rate play a minor role explaining entry and exit. This last result is consistent with hysteresis in international markets.

Keywords: Entry, Exit, International Markets, Chile

JEL Classification: F14, D21, O54

Suggested Citation

Alvarez, Roberto and López, Ricardo A., Entry and Exit in International Markets: Evidence from Chilean Data (September 29, 2006). CAEPR Working Paper No. 2006-014. Available at SSRN: https://ssrn.com/abstract=650922 or http://dx.doi.org/10.2139/ssrn.650922

Roberto Alvarez (Contact Author)

University of Chile - Department of Economics ( email )

Diagonal Paraguay 257
Torre 26, Of. 1801
Santiago
Chile

Ricardo Lopez

Brandeis International Business School ( email )

Mailstop 32
Waltham, MA 02454-9110
United States

HOME PAGE: http://people.brandeis.edu/~rlopez/

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