Export Entrepreneurs : Evidence from Peru

This paper examines firm entry and survival in exporting, and in products and markets not previously served by any domestic exporters. The authors use data on the nontraditional agriculture sector in Peru, which grew seven-fold from 1994 to 2007. T...

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Main Authors:	Freund, Caroline, Pierola, Martha Denisse
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	ACCOUNTING AGRICULTURE BRAND BRAND NAMES CD CENTRAL BANK COMPANY COMPETITIVENESS COMPETITOR COMPETITORS DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DIRECT MARKET DISCOUNTED VALUE DOMESTIC MARKET DOMESTIC MARKETS ECONOMIC DEVELOPMENT ENTREPRENEUR ENTREPRENEURS ENTREPRENEURSHIP EXCHANGE RATE EXPANSION EXPECTED VALUE EXPORT GROWTH EXPORT MARKET EXPORT MARKETS EXPORTER EXPORTERS EXPORTS FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL SUPPORT FIRMS FIXED COSTS FOREIGN MARKET FOREIGN MARKETS GLOBAL ECONOMY GLOBALIZATION GOVERNMENT POLICY HOME MARKET INTERNATIONAL BANK INTERNATIONAL DEVELOPMENT INTERNATIONAL ECONOMICS INTERNATIONAL MARKETS INTERNATIONAL TRADE INTERNATIONAL TRANSACTIONS INVESTING INVESTOR CONFIDENCE LAND PRIVATIZATION MARKET ACCESS MARKET CONDITIONS MARKET DEVELOPMENT MARKET INFORMATION MARKET PARTICIPANTS MARKET REQUIREMENTS MARKET SHARE MARKET SHARES MARKETING MERCHANDISE NEGATIVE SHOCK OPPORTUNITY COST OVERHEAD COST POLITICAL ECONOMY PRODUCT MARKET PRODUCTION FUNCTION PRODUCTIVITY REGRESSION ANALYSIS RETURN SALES SIZE OF FIRMS SUNK COSTS TAX TRANSACTION TRUST FUND WAGES
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20100830093224 http://hdl.handle.net/10986/3892

id	okr-10986-3892
recordtype	oai_dc
spelling	okr-10986-38922021-04-23T14:02:13Z Export Entrepreneurs : Evidence from Peru Freund, Caroline Pierola, Martha Denisse ACCOUNTING AGRICULTURE BRAND BRAND NAMES CD CENTRAL BANK COMPANY COMPETITIVENESS COMPETITOR COMPETITORS DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DIRECT MARKET DISCOUNTED VALUE DOMESTIC MARKET DOMESTIC MARKETS ECONOMIC DEVELOPMENT ENTREPRENEUR ENTREPRENEURS ENTREPRENEURSHIP EXCHANGE RATE EXPANSION EXPECTED VALUE EXPORT GROWTH EXPORT MARKET EXPORT MARKETS EXPORTER EXPORTERS EXPORTS FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL SUPPORT FIRMS FIXED COSTS FOREIGN MARKET FOREIGN MARKETS GLOBAL ECONOMY GLOBALIZATION GOVERNMENT POLICY HOME MARKET INTERNATIONAL BANK INTERNATIONAL DEVELOPMENT INTERNATIONAL ECONOMICS INTERNATIONAL MARKETS INTERNATIONAL TRADE INTERNATIONAL TRANSACTIONS INVESTING INVESTOR CONFIDENCE LAND PRIVATIZATION MARKET ACCESS MARKET CONDITIONS MARKET DEVELOPMENT MARKET INFORMATION MARKET PARTICIPANTS MARKET REQUIREMENTS MARKET SHARE MARKET SHARES MARKETING MERCHANDISE NEGATIVE SHOCK OPPORTUNITY COST OVERHEAD COST POLITICAL ECONOMY PRODUCT MARKET PRODUCTION FUNCTION PRODUCTIVITY REGRESSION ANALYSIS RETURN SALES SIZE OF FIRMS SUNK COSTS TAX TRANSACTION TRUST FUND WAGES This paper examines firm entry and survival in exporting, and in products and markets not previously served by any domestic exporters. The authors use data on the nontraditional agriculture sector in Peru, which grew seven-fold from 1994 to 2007. They find tremendous firm entry and exit in the export sector, with exits more likely after one year and among firms that start small. There is also significant entry and exit in new markets. In contrast, such trial and error in new products is rare. New products are typically discovered by large experienced exporters and there is increased entry after products are discovered. The results imply that high sunk costs of entry are of concern for product discovery, especially for products that are not consumed domestically. In contrast, the tremendous entry and exit in exporting and in new markets suggests that initial sunk costs are relatively low. The authors develop a model that explains how entrepreneurs decide to export and to develop new export products and markets when there are sunk costs of discovery and uncertainty about idiosyncratic costs. The model explains many features of the data. 2012-03-19T18:41:41Z 2012-03-19T18:41:41Z 2010-08-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20100830093224 http://hdl.handle.net/10986/3892 English Policy Research working paper ; no. WPS 5407 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper Latin America & Caribbean Latin America & Caribbean South America America Peru
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	ACCOUNTING AGRICULTURE BRAND BRAND NAMES CD CENTRAL BANK COMPANY COMPETITIVENESS COMPETITOR COMPETITORS DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DIRECT MARKET DISCOUNTED VALUE DOMESTIC MARKET DOMESTIC MARKETS ECONOMIC DEVELOPMENT ENTREPRENEUR ENTREPRENEURS ENTREPRENEURSHIP EXCHANGE RATE EXPANSION EXPECTED VALUE EXPORT GROWTH EXPORT MARKET EXPORT MARKETS EXPORTER EXPORTERS EXPORTS FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL SUPPORT FIRMS FIXED COSTS FOREIGN MARKET FOREIGN MARKETS GLOBAL ECONOMY GLOBALIZATION GOVERNMENT POLICY HOME MARKET INTERNATIONAL BANK INTERNATIONAL DEVELOPMENT INTERNATIONAL ECONOMICS INTERNATIONAL MARKETS INTERNATIONAL TRADE INTERNATIONAL TRANSACTIONS INVESTING INVESTOR CONFIDENCE LAND PRIVATIZATION MARKET ACCESS MARKET CONDITIONS MARKET DEVELOPMENT MARKET INFORMATION MARKET PARTICIPANTS MARKET REQUIREMENTS MARKET SHARE MARKET SHARES MARKETING MERCHANDISE NEGATIVE SHOCK OPPORTUNITY COST OVERHEAD COST POLITICAL ECONOMY PRODUCT MARKET PRODUCTION FUNCTION PRODUCTIVITY REGRESSION ANALYSIS RETURN SALES SIZE OF FIRMS SUNK COSTS TAX TRANSACTION TRUST FUND WAGES
spellingShingle	ACCOUNTING AGRICULTURE BRAND BRAND NAMES CD CENTRAL BANK COMPANY COMPETITIVENESS COMPETITOR COMPETITORS DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DIRECT MARKET DISCOUNTED VALUE DOMESTIC MARKET DOMESTIC MARKETS ECONOMIC DEVELOPMENT ENTREPRENEUR ENTREPRENEURS ENTREPRENEURSHIP EXCHANGE RATE EXPANSION EXPECTED VALUE EXPORT GROWTH EXPORT MARKET EXPORT MARKETS EXPORTER EXPORTERS EXPORTS FEDERAL RESERVE FEDERAL RESERVE BANK FINANCIAL SUPPORT FIRMS FIXED COSTS FOREIGN MARKET FOREIGN MARKETS GLOBAL ECONOMY GLOBALIZATION GOVERNMENT POLICY HOME MARKET INTERNATIONAL BANK INTERNATIONAL DEVELOPMENT INTERNATIONAL ECONOMICS INTERNATIONAL MARKETS INTERNATIONAL TRADE INTERNATIONAL TRANSACTIONS INVESTING INVESTOR CONFIDENCE LAND PRIVATIZATION MARKET ACCESS MARKET CONDITIONS MARKET DEVELOPMENT MARKET INFORMATION MARKET PARTICIPANTS MARKET REQUIREMENTS MARKET SHARE MARKET SHARES MARKETING MERCHANDISE NEGATIVE SHOCK OPPORTUNITY COST OVERHEAD COST POLITICAL ECONOMY PRODUCT MARKET PRODUCTION FUNCTION PRODUCTIVITY REGRESSION ANALYSIS RETURN SALES SIZE OF FIRMS SUNK COSTS TAX TRANSACTION TRUST FUND WAGES Freund, Caroline Pierola, Martha Denisse Export Entrepreneurs : Evidence from Peru
geographic_facet	Latin America & Caribbean Latin America & Caribbean South America America Peru
relation	Policy Research working paper ; no. WPS 5407
description	This paper examines firm entry and survival in exporting, and in products and markets not previously served by any domestic exporters. The authors use data on the nontraditional agriculture sector in Peru, which grew seven-fold from 1994 to 2007. They find tremendous firm entry and exit in the export sector, with exits more likely after one year and among firms that start small. There is also significant entry and exit in new markets. In contrast, such trial and error in new products is rare. New products are typically discovered by large experienced exporters and there is increased entry after products are discovered. The results imply that high sunk costs of entry are of concern for product discovery, especially for products that are not consumed domestically. In contrast, the tremendous entry and exit in exporting and in new markets suggests that initial sunk costs are relatively low. The authors develop a model that explains how entrepreneurs decide to export and to develop new export products and markets when there are sunk costs of discovery and uncertainty about idiosyncratic costs. The model explains many features of the data.
format	Publications & Research :: Policy Research Working Paper
author	Freund, Caroline Pierola, Martha Denisse
author_facet	Freund, Caroline Pierola, Martha Denisse
author_sort	Freund, Caroline
title	Export Entrepreneurs : Evidence from Peru
title_short	Export Entrepreneurs : Evidence from Peru
title_full	Export Entrepreneurs : Evidence from Peru
title_fullStr	Export Entrepreneurs : Evidence from Peru
title_full_unstemmed	Export Entrepreneurs : Evidence from Peru
title_sort	export entrepreneurs : evidence from peru
publishDate	2012
url	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20100830093224 http://hdl.handle.net/10986/3892
_version_	1764388882732810240

Export Entrepreneurs : Evidence from Peru

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