Publication Type
Working Paper
Version
publishedVersion
Publication Date
8-2014
Abstract
The paper provides a first structural-estimation-based assessment of an influential hypothesis that export pioneers are too few relative to social optimum due to knowledge spillover in new market explorations. Such market failure requires two inequalities to hold simultaneously: the discovery cost is greater than any individual firm’s expected profit but Smaller than the sum of all potential exporters’ expected profits. Neither has to hold in the data. We estimate the structural parameters based on the customs data of Chinese electronics exports. While we find positive discover cost and spillovers, "missing pioneers" are nonetheless a low probability event.
Discipline
Econometrics
Research Areas
Applied Microeconomics
First Page
1
Last Page
63
Citation
WEI, Shang-Jin; WEI, Ziru; and XU, Jianhuan.
Assessing market failures in export pioneering activities: A structural estimation approach. (2014). 1-63.
Available at: https://ink.library.smu.edu.sg/soe_research/2025
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
http://abfer.org/docs/2015/program-4/assessing-market-failures-in-export-pioneering-activities-a-structural-estimation-approach.pdf