destinations to total export growth in each country, obtained as the ratio of each of the terms to the left-hand-side of Eq. (3).

To provide insights into the role of new exporters, new products, and new destinations, we conduct complementary decompositions of their contribution to total exports that take into account the permanence of new export flows. Assuming _k=1_ in the above decompositions and considering the new exporting firms, we separate them into two groups: those that continue to export in _t+1_ and those that do not export in _t+1_ . We then decompose the contribution of new exporters to total export growth into the contribution of entering and exiting exporting firms. Similarly, we separate new products of incumbent exporters into two groups: those that continue to be exported by incumbent exporters in _t+1_ and those that are not exported in _t+1_ . We then decompose the contribution of new products to total export growth of incumbent exporters into the contribution of new and departing products. Likewise, we separate new destinations of incumbent exporters into two groups: those that continue to be served by incumbent exporters in _t+1_ and those that cease to be served in _t+1_ . We then decompose the contribution of new and departing destinations to total export growth of incumbent exporters. We compute these complementary decompositions for the period 2005-2007 as described above for Eqs. (1)-(3).

# **_4. Export Entrepreneurship across LAC Countries along the New Exporter Dimension_**

This section examines patterns of export entrepreneurship in LAC countries by focusing on the extensive margin in terms of new firms entering export markets. To facilitate international comparisons with the LAC countries we selected comparators from around the world for three types of economies: (1) natural resource countries that include Chile, Colombia, Peru, and Costa Rica from LAC; (2) simple processing or assembly economies with Guatemala, Dominican Republic, El Salvador, and Nicaragua; and (3) countries with a broad export manufacturing base, including Brazil and Mexico.<sup>16</sup> The natural resource countries were chosen based on net exports of natural resources during 1980-2005 (see Lederman and Maloney, 2012).<sup>17</sup> The simple processing countries have high shares of exports of apparel and textiles in their total exports,

> 16 The comparators selected are based on the availability of data on export entrepreneurship in the Exporter Dynamics Database. 17 It is noteworthy that most LAC countries are net exporters of energy, mining or agriculture. In the case of Costa Rica, the economy is a net exporter of various agricultural commodities. It is also a major exporter of superconductors due to an INTEL plant. However, we work with data that excludes INTEL following existing literature (e.g., Lederman, Rodriguez-Clare and Xu 2012), partly because the story of INTEL is well known. Furthermore, although Brazil and Mexico are also net exporters of commodities, they have much more diversified export structures (as measured by the standard indicators, such as the Herfindahl index of export-revenue concentration) as well as high shares of manufactured exports over total merchandise exports.

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