Sertkaya, Sevi.pdf (1.25 MB)
Sequential exporting with carry-along trade products: evidence from Turkey
thesis
posted on 2023-06-09, 08:10 authored by Sevi SertkayaInternational trade literature rationalizes that inexperienced firms mostly start exporting with small shipments to a neighboring country to discover their own capabilities. This strategy is called sequential exporting and is observed in different countries and with different products. On the other hand, recent evidence shows that manufacturing firms do not actually produce all of their exports. Carry-along Trade (CAT) refers to the exports of manufacturing firms that are not produced by themselves. CAT exports turn out to be relevant in terms of intensive and extensive margins of firms’ aggregate exports. The aim of the thesis is to combine these two different strands of literature by using the theoretical and empirical characteristics of CAT (not self-produced), and MAN (selfproduced) products. In the theoretical framework, MAN products have high sunk costs and low marginal costs, whereas CAT products have higher marginal costs and lower sunk costs. The sequential exporting model of Albornoz et al., (2012) is adjusted slightly to allow for different CAT and MAN cost structures and new predictions are derived. In the empirical section, these predictions are tested by exploiting matched firm-level Turkish Foreign Trade, Production, and Structural Business Statistics datasets for the period 2005-2011. New exporters which survive to export in the second year are classified into two groups: sequential exporters that experiment in only one market and simultaneous exporters that experiment in at least two markets. The results show that both sequential and simultaneous exporters tend to use CAT exports for experimentation and for expanding their market coverage. For second-year expansion in their first-markets, simultaneous exporters’ use CAT and MAN products roughly equally while sequential exporters derive their export growth largely from CAT products. Operating in non-credit constrained sectors accentuates the previous findings of first year-first market export growth and the probability of second-year entry to new markets. Findings of first yearfirst market export growth are intact for added specifications of productivity and foreign ownership. However, no inferences can be drawn for the probability of entering new markets in the second-year of exporting.
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File Version
- Published version
Pages
133.0Department affiliated with
- Economics Theses
Qualification level
- masters
Qualification name
- mphil
Language
- eng
Institution
University of SussexFull text available
- Yes
Legacy Posted Date
2017-10-04Usage metrics
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