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Estimating the extensive margin of trade

Santos Silva, JMC, Tenreyro, S and Wei, K (2014) Estimating the extensive margin of trade JOURNAL OF INTERNATIONAL ECONOMICS, 93 (1). pp. 67-75.

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Understanding and quantifying the determinants of the number of sectors or firms exporting in a given country is of relevance for the assessment of trade policies. Estimation of models for the number of exporting sectors, however, poses a challenge because the dependent variable has both a lower and an upper bound, implying that the partial effects of the explanatory variables on the conditional mean of the dependent variable cannot be constant. We argue that ignoring these bounds can lead to erroneous conclusions and propose a flexible specification that accounts for the doubly-bounded nature of the dependent variable. We empirically investigate the problem and the proposed solution, finding significant differences between estimates obtained with the proposed estimator and those obtained with standard approaches

Item Type: Article
Subjects : subj_Economics
Divisions : Faculty of Arts and Social Sciences > School of Economics
Authors :
Santos Silva, JMC
Tenreyro, S
Wei, K
Date : 1 May 2014
DOI : 10.1016/j.jinteco.2013.12.001
Copyright Disclaimer : © 2014 The Authors. Published by Elsevier B.V. This is an open access article under the CC BY-NC-ND license (
Uncontrolled Keywords : Social Sciences, Economics, Business & Economics, ECONOMICS, Bounded data, Estimation of trade models, Number of sectors, INTERNATIONAL-TRADE, GROWTH, DIVERSIFICATION, VOLATILITY, GRAVITY, MODELS, FIRMS
Related URLs :
Depositing User : Symplectic Elements
Date Deposited : 11 May 2016 14:38
Last Modified : 31 Oct 2017 18:17

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