TY  - RPRT
        AU  - Naudé, Wim
AU  - Gries, Thomas
AU  - Bilkic, Natasa
        TI  - Firm-Level Heterogeneity and the Decision to Export: A Real Option Approach
        PY  - 2013/Apr/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 7346
        UR  - https://www.iza.org/publications/dp7346
        AB  - In "new" new international trade theory, whether firms export or not are determined by their productivity. These models assume that firms enter a market to find their productivity levels revealed to them as in a lottery. In this paper we propose an alternative way to model whether firms export or not, namely as a firm-level decision akin to an investment decision with a real option value. We show that endogenizing the export decision is consistent with patterns of productivity and exporting reported in the empirical literature.
        KW  - international new ventures
KW  - firm-level heterogeneity
KW  - start-ups
KW  - stochastic dynamic programming
KW  - trade
KW  - exports
KW  - productivity
KW  - real option theory
KW  - investment
KW  - firms
KW  - international entrepreneurship
        ER  -