Old Firms and New Products: Does Experience Increase Survival?

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Title: Old Firms and New Products: Does Experience Increase Survival?
Authors: Lawless, Martina
Studnicka, Zuzanna
Permanent link: http://hdl.handle.net/10197/9446
Date: Feb-2018
Abstract: We examine the relationship between exporting experience and the duration of firm export product flows. We find that more experienced firms (in years of exporting) show a higher probability of failure associated with the introduction of new products. On the other hand, firms with broader export scope are more likely to have better survival times for newly launched products. Although apparently counter-intuitive, we show that this finding is consistent with models of multi-product firms in which firms begin exporting by launching the products closest to their core competency and gradually expand their range of products by exporting those that are further away from their core, resulting in lower survival probability for later products. Validating this interpretation, we show that the distance of the new products to the core competency of the firm plays an important role in determining the survival of new products.
Type of material: Working Paper
Publisher: University College Dublin. School of Economics
Start page: 1
End page: 20
Series/Report no.: UCD Centre for Economic Research Working Paper Series; WP2018/05
Keywords: Duration of TradeFirm SurvivalExport ExperienceMulti-product firms
Language: en
Status of Item: Not peer reviewed
Appears in Collections:Economics Working Papers & Policy Papers

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