Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/71322
Authors: 
Lawless, Martina
Whelan, Karl
Year of Publication: 
2008
Series/Report no.: 
Working Paper Series, UCD Centre for Economic Research 08/21
Abstract: 
The empirical finding that exporting firms are more productive on average than non-exporters has provoked a large theoretical literature based on models such as Melitz (2003), where more productive firms are more likely to overcome costs associated with trade. This paper provides a systematic empirical assessment of the Melitz framework using a unique Irish dataset that includes information on destinations and firm characteristics such as productivity. We find a number of interesting deviations from the model's predictions including a high degree of unpredictable idiosyncratic participation in export markets by firms, a relatively weak positive correlation between the extent of export participation and export sales, and a limited role for productivity in explaining firm exporting behavior. We illustrate the effect of firm heterogeneity on gravity regressions of aggregate trade flows and show how past exporting to a particular market has a strong impact on the current probability of exporting there.
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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