Product and destination mix in export markets.pdf

ORI GIN AL PA PER Product and destination mix in export markets Joa?o Amador ? Luca David Opromolla Published online: 9 October 2012  Kiel Institute 2012 Abstract This article studies the joint destination and product strategies of exporters, using the universe of export transactions for firms located in Portugal in the period 1995–2005. The article breaks down the annual growth rate of total exports along different margins and details choices made by multi-product, multi- destination firms regarding their export portfolio. In addition, the article looks at similar features for the subsample of new exporters. We find that both the firm-level extensive and intensive margins are important in driving the year-to-year variation in aggregate exports. However, variation over time in the sales of continuing exporters is mainly driven by their sales in continuing destinations. In addition, a product’s export tenure within a firm varies largely across currently exported products in the context of an intense activity of product and destination switching. Moreover, the higher the importance of a product, the more its sales are concen- trated in the firm’s top destination. Finally, the article finds that, while continuing exporters enter new markets mainly by selling old products, new exporters access new destinations mainly by exporting new products. Keywords Multi-product firm  Product scope  Market penetration  Exports J. Amador Nova School of Business and Economics, Campus de Campolide, 1099-032 Lisbon, Portugal e-mail: jamador@bportugal.pt J. Amador  L. D. Opromolla () Research Department Central Bank of Portugal, R. do Ouro, 27, 1100 Lisbon, Portugal e-mail: luca.opromolla@nyu.edu L. D. Opromolla UECE (Research Unit on Complexity and Economics), Technical University of Lisbon, Rua Miguel Lupi 20, 1249-078 Lisbon, Portugal 123 Rev World Econ (2013) 149:23–53 DOI 10.1007/s10290-012-0136-z JEL Classification F1  L25  D21 1 Introduction The empirical research in intern