Department of Economics and Business Economics

Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets

Research output: Working paperResearch

Standard

Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets. / Ciliberto, Federico; Jäkel, Ina Charlotte.

Aarhus : Institut for Økonomi, Aarhus Universitet, 2017.

Research output: Working paperResearch

Harvard

APA

Ciliberto, F., & Jäkel, I. C. (2017). Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets. Aarhus: Institut for Økonomi, Aarhus Universitet. Economics Working Papers, No. 2017-09

CBE

MLA

Ciliberto, Federico and Ina Charlotte Jäkel Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets. Aarhus: Institut for Økonomi, Aarhus Universitet. (Economics Working Papers; Journal number 2017-09). 2017., 53 p.

Vancouver

Ciliberto F, Jäkel IC. Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets. Aarhus: Institut for Økonomi, Aarhus Universitet. 2017 Sep 18.

Author

Ciliberto, Federico ; Jäkel, Ina Charlotte. / Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets. Aarhus : Institut for Økonomi, Aarhus Universitet, 2017. (Economics Working Papers; No. 2017-09).

Bibtex

@techreport{43531d6c0e474f04b11e5805f31e2c95,
title = "Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets",
abstract = "In many countries, exports are highly concentrated among a few {"}superstar{"} firms. We estimate the export decisions of superstar firms as the result of a complete information, simultaneous, discrete choice, static entry game. We employ a dataset on the universe of Danish trade transactions by firm, product and destination. We also obtain detailed information on applied, preferential tariff protection from the MAcMap-HS6 database. We find evidence of strong negative competitive effects of entry: in the absence of strategic competitive effects, firms would be 54.3 percentage points more likely to export to a given market. Next, we run two counterfactual exercises. We show that failing to account for the strategic interaction among superstar exporters leads to: (i) overstating the probability that firms would start exporting to a market following tariff elimination by 8 percentage points; and, (ii) overstating the probability that firms would stop exporting to a market if tariffs were imposed by 7.5 percentage points. We also show that competitive effects vary across export markets and competitors. This heterogeneity in the competitive effects implies that there exist multiple equilibria, both in the identity and in the number of firms.",
keywords = "Export participation, Strategic interaction, Multiple equilibria, Trade policy",
author = "Federico Ciliberto and J{\"a}kel, {Ina Charlotte}",
year = "2017",
month = "9",
day = "18",
language = "English",
publisher = "Institut for {\O}konomi, Aarhus Universitet",
type = "WorkingPaper",
institution = "Institut for {\O}konomi, Aarhus Universitet",

}

RIS

TY - UNPB

T1 - Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets

AU - Ciliberto, Federico

AU - Jäkel, Ina Charlotte

PY - 2017/9/18

Y1 - 2017/9/18

N2 - In many countries, exports are highly concentrated among a few "superstar" firms. We estimate the export decisions of superstar firms as the result of a complete information, simultaneous, discrete choice, static entry game. We employ a dataset on the universe of Danish trade transactions by firm, product and destination. We also obtain detailed information on applied, preferential tariff protection from the MAcMap-HS6 database. We find evidence of strong negative competitive effects of entry: in the absence of strategic competitive effects, firms would be 54.3 percentage points more likely to export to a given market. Next, we run two counterfactual exercises. We show that failing to account for the strategic interaction among superstar exporters leads to: (i) overstating the probability that firms would start exporting to a market following tariff elimination by 8 percentage points; and, (ii) overstating the probability that firms would stop exporting to a market if tariffs were imposed by 7.5 percentage points. We also show that competitive effects vary across export markets and competitors. This heterogeneity in the competitive effects implies that there exist multiple equilibria, both in the identity and in the number of firms.

AB - In many countries, exports are highly concentrated among a few "superstar" firms. We estimate the export decisions of superstar firms as the result of a complete information, simultaneous, discrete choice, static entry game. We employ a dataset on the universe of Danish trade transactions by firm, product and destination. We also obtain detailed information on applied, preferential tariff protection from the MAcMap-HS6 database. We find evidence of strong negative competitive effects of entry: in the absence of strategic competitive effects, firms would be 54.3 percentage points more likely to export to a given market. Next, we run two counterfactual exercises. We show that failing to account for the strategic interaction among superstar exporters leads to: (i) overstating the probability that firms would start exporting to a market following tariff elimination by 8 percentage points; and, (ii) overstating the probability that firms would stop exporting to a market if tariffs were imposed by 7.5 percentage points. We also show that competitive effects vary across export markets and competitors. This heterogeneity in the competitive effects implies that there exist multiple equilibria, both in the identity and in the number of firms.

KW - Export participation, Strategic interaction, Multiple equilibria, Trade policy

M3 - Working paper

BT - Superstar Exporters: An Empirical Investigation of Strategic Interactions in Danish Export Markets

PB - Institut for Økonomi, Aarhus Universitet

CY - Aarhus

ER -