TY  - JOUR
AU  - Besedes,Tibor
AU  - Prusa,Thomas J.
TI  - The Role of Extensive and Intensive Margins and Export Growth
JF  - National Bureau of Economic Research Working Paper Series
VL  - No. 13628
PY  - 2007
Y2  - November 2007
UR  - http://www.nber.org/papers/w13628
L1  - http://www.nber.org/papers/w13628.pdf
N1  - Author contact info:
Tibor Besedes
School of Economics
Georgia Institute of Technology
Atlanta, Georgia 30332-0615
E-Mail: besedes@gatech.edu

Thomas J. Prusa
Department of Economics
New Jersey Hall
Rutgers University
New Brunswick, NJ 08901-1248
Tel: 908.443.1565
E-Mail: prusa@econ.rutgers.edu
AB  - We investigate and compare countries' export growth based on their performance at the extensive and intensive export margins. Our empirical approach is motivated by an extension to the Melitz (2003) model of heterogeneous firms in which exporters are subject to a one-time sunk cost and also a per-period fixed cost. With imperfect information a firm may enter export markets but shortly exit when it learns its per- period fixed costs. We apply this insight to disaggregated export data and confirm that indeed most export relationships are very short lived. We then show that the survival issue is a significant factor in explaining differences in long run export performance. We find that developing countries would experience significantly higher export growth if they were able to improve their performance with respect to the two key components of the intensive margin: survival and deepening. 
ER  -