Exporter Dynamics, Firm Size and Growth, and Partial Year Effects an analytical framework to study firm and export growth and evaluates the model by comparing results of calibration exercises with the growth of sales of US firms as well as with Brazilian export sales to the US. His argument that the same processes are at work within an economy and in export markets as firms search for customers motivates us to use export data to analyze the impact of partial years for new entrants in a market.

# **The characteristics and performance of new exporters**

The empirical literature on the dynamics of firm-level exports was initiated by the work of Eaton, Eslava, Kugler, and Tybout (2008) on Colombian exporters. Eaton, Eslava, Kugler, and Tybout (2008) set out to generate a new set of stylized facts on export dynamics and destination-specific flows for the same set of producers using annual trade transaction data for Colombian firms. In the abstract to the paper, they state “that nearly half of all Colombian exporters were not exporters in the previous year. These new exporters tend to be extremely small in terms of their overall contribution to export revenues, and most do not continue exporting in the following year.... Nonetheless, out of each cohort of new exporters, a fraction of firms go on to expand their foreign sales very rapidly....” Empirical work on annual firm-level export data that confirms some or all of these facts for other countries includes Lawless (2009) for Irish exporters and Buono and Fadinger (2012) for French exporters.

These stylized facts in turn have been used and extended by others to motivate dynamic models of exporting and learning. In Albornoz, Pardo, Corcos, and Ornelas (2012), firms experiment in a market to learn about export profitability and then expand to new destinations. In their empirical work on Argentine exporters, they confirm the small size, low survival and rapid growth of new exporters. They report that growth rates between the first and second years in a market range from 104 to 190 percent. In every case, they find that second year growth rates in export markets are much lower and are not substantially different from growth rates in subsequent years.

Eaton, Eslava, Jinkins, Krizan, and Tybout (2012) develop a model of search and learning to explain the dynamic pattern of entry and survival by Colombian exporters and to differentiate between the costs of finding new buyers and maintaining relationships with existing ones. Aeberhardt, Buono, and Fadinger (2012) and Araujo, Mion, and Ornelas (2012) model exporter dynamics in the context of contracting, learning and institutional quality, again confirming the small size upon entry of new exporters and their subsequent rapid growth conditional on survival, using annual firm-level French and Belgian data, respectively.

Akhmetova and Mitaritonna (2012) develop a model of experimentation and learning to explain the fact that new exporters exhibit different patterns in a given market than old exporters. They emphasize the facts of Eaton, Eslava, Jinkins, Krizan, and Tybout (2012) for Colombia and Eaton, Kortum, and Kramarz (2011) for France - many new exporters ship very small quantities and 3