Abstract

This paper analyzes the export-behavior of Chilean agribusiness and food processing firms and the relative importance of firm-specific and geographic characteristics in this behavior. Using firm level data and regional geographic indicators, a dynamic model was used to study the export decisions and the export intensity of three industries: processing fish, processing fruits and vegetables, and wine production. Results showed that determinants of exporting behavior vary among the three industries, except the effect of sunk costs, which strongly impacts the export decisions of all analyzed industries. This implies that firms with prior export experience will have higher probability of exporting in the future. Foreign ownership positively impacts the export decision of the two processing industries. Thus, firms belonging to these industries that wish to increase the probability of being an exporter should be encouraged to have a partnership with a foreign company or investor. The export intensity is positively influenced by foreign ownership in the fruit and vegetables processing and wine industries. As in the case of the export decision of firms, foreign participation helps increase the scale of exports. In general, firm-specific characteristics significantly impact the export behavior in Chilean agribusiness and processed food industries, while the contribution of geography attributes appears mixed.