TY - BOOK ID - 135441747 TI - What Explains the Low Survival Rate of Developing Country Export Flows? AU - Brenton, Paul AU - Saborowski, Christian AU - von Uexkull, Erik PY - 2009 PB - Washington, D.C., The World Bank, DB - UniCat KW - Adverse impacts KW - Bilateral trade KW - Currencies and Exchange Rates KW - Debt Markets KW - Econometric analysis KW - Economic size KW - Economic Theory and Research KW - Emerging Markets KW - Export growth KW - Exports KW - Finance and Financial Sector Development KW - Fixed costs KW - Free Trade KW - Income KW - Income groups KW - Income levels KW - Inequality KW - International Economics and Trade KW - International trade KW - Law and Justice KW - Macroeconomics and Economic Growth KW - Markets and Market Access KW - Overvaluation KW - Poverty Reduction KW - Private Sector Development KW - Product differentiation KW - Production costs KW - Purchasing power KW - Tax Law KW - Technical assistance KW - Trade Law KW - Trade Policy KW - Trade policy KW - Transition economies KW - Unemployment KW - Wealth UR - https://www.unicat.be/uniCat?func=search&query=sysid:135441747 AB - Successful export growth and diversification require not only entry into new export products and markets, but also the survival and growth of export flows. This paper uses a detailed, cross-country dataset of product level bilateral export flows to illustrate that exporting is an extremely perilous activity and especially so in low-income countries. The authors find that unobserved individual heterogeneity in product-level export flow data prevails despite controlling for a wide range of observed country and product characteristics. This questions previous studies that have used the Cox proportional hazards model to model export survival. The authors estimate a Prentice-Gloeckler model, amended with a gamma mixture distribution summarizing unobserved individual heterogeneity. The empirical results confirm the significance of a range of products as well as country-specific factors in determining the survival of export flows. From a policy perspective, an interesting finding is the importance of learning-by-doing for export survival: experience with exporting the same product to other markets or different products to the same market are found to strongly increase the chance of export survival. A better understanding of such learning effects could substantially improve the effectiveness of export promotion strategies. ER -