Exchange Rate Pass-Through in ASEAN: Identifying Supply-Side Constraints to Export Performance in Ecuador: An Exercise with Investment Climate Survey Data

Manuela Francisco (), Paulo Correa and Mariam Dayoub
Additional contact information
Paulo Correa: ECSPF
Mariam Dayoub: LCSPF

No 1/2007, NIPE Working Papers from NIPE - Universidade do Minho

Abstract: We apply a Heckman selection model to the 2003-Investment Climate Survey (ICS) to investigate supply-side constraints to export performance at the firm level in Ecuador. To correct for the non-random truncation problem, we use the Heckman selection model to estimate the probability of exporting (export propensity) and the share of total sales that are exported (export intensity) by Ecuadorian firms. A baseline model with 12 independent variables divided into three categories – idiosyncratic characteristics, technology, and business environment – is developed. Three other models are developed with the addition of variables related to trade integration, business environment, and infrastructure. Results corroborate with the hypothesis implicit in the Heckman model, which considers both decisions made by a firm – whether to export, and how much of its sales to export – to be interdependent. In the Ecuadorian case, three important results for the firm’s export performance are found: technology matters; infrastructure does not; and trade orientation is significant, with specialized firms tending to have smaller export intensity when having the countries of the Andean Community as their main trade partners, the opposite happening if the U.S. is their main trade partner. We find a robust and stable relationship for export propensity and intensity with size, import of inputs, labor regulations, in-house R&D, quality certification, web-use, and foreign ownership. Also, capacity utilization and trade with the U.S. positively affect export intensity, while trade within the Andean Community has the opposite effect in our outcome variable. No significant relationship was found for the infrastructure variables.World Bank Policy Research Working Paper 4179, March 2007.

Keywords: Ecuador; exports; innovation; foreign networks; business environment; firm level (search for similar items in EconPapers)
Date: 2007
New Economics Papers: this item is included in nep-edu, nep-hrm, nep-lab and nep-sog
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www3.eeg.uminho.pt/economia/nipe/docs/2007/NIPE_WP_1_2007.PDF (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nip:nipewp:1/2007

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in NIPE Working Papers from NIPE - Universidade do Minho Núcleo de Investigação em Políticas Económicas e Empresariais, Escola de Economia e Gestão, Universidade do Minho, P-4710-057 Braga, Portugal. Contact information at EDIRC.
Bibliographic data for series maintained by NIPE ().