n African Journal of Business and Economic Research - A note on developing countries' export supply response

Volume 1, Issue 1
  • ISSN : 1750-4554
  • E-ISSN: 1750-4562


This article comments on the export supply response of developing countries. As developing countries are more exposed to irrecoverable entry costs in international markets their export supply response differs from that of developed countries. In developing countries the relationship between export supply and exchange rates is most likely to be persistent (path-dependent). However, the form of persistence depends on the structure of the countries' export industry. Countries where the structure of the export industry consists of a few large firms with homogenous production technologies and equal market entry costs differ in their export persistence response compared to countries where the structure is dominated by small and medium sized enterprises with different production technologies and diverse market entry costs. In order to implement successful export promotion programmes in developing countries, a deeper understanding of differences in the structure of their export industries is necessary.

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