Geographical and industrial spillovers in entry decisions across export markets

Abstract

This paper addresses sequential entry decisions in export markets. It focuses on externalities derived from previous export activity in countries close to those for which a potential entry decision is taken (geographical spillovers) and externalities derived from previous presence of other firms in the same industry (industrial spillovers). The empirical analysis uses Spanish microdata for the period 2000-2010 in a firm decision model that also integrates country and firm characteristics. The results suggest the positive effect of both geographical and industrial spillovers to explain entry decisions in export markets, though both are smaller in magnitude than the effects coming from previous presence.