10 The figure also provides 95 percent confidence bands to assess the statistical significance of the EPA characteristics in explaining variations in export-promotion budgets. It is possible to assess the confidence bands in the graphs with the help of table 2. The first column labeled ’Estimated DoF’ indicates the degree of the best-fitting polynomial. The second column provides the p-value of the estimated degrees of freedom. As the spline estimator allows for piecewise polynomials, the degrees of freedom approximates do not necessarily take integer numbers. If the number equals 1, it implies a linear function in fig. 1. If it is 2, it implies a quadratic function. If 0 is included over the entire confidence band, then the degree of the polynomial is not statistically significant in table 2. The results suggest that the share of public funding, the share of board seats in the hands of the private sector, the share of the budget spent on nonmatching

**Table 2.** Approximate Significance of Smooth Terms of Estimates in equation (2)

||**Dependent variabl**|**e: ln (budget)**|
|---|---|---|
||**Estimated DoF**|**p-value**|
|Log of population|8.241<sup>** </sup>|0.020|
|_bg_(Public source of funding)|1.000<sup>**</sup>|0.017|
|_bq_(Share of private sector over total at board)|2.830<sup>**</sup>|0.036|
|_bj_(Budget spent on nonmatching grants)|1.000<sup>*** </sup>|0.001|
|_bi_(Rank of TPO responsibility)|3.869<sup>***</sup>|0.003|
|_bk_(Budget coming from fees for services)|1.866|0.291|
|Observations|371||
|Adjusted R<sup>2</sup>|0.960||

_Source_ : Authors’ nonparametric estimation of equation (2). _Note_ : Standard errors in parenthesis.<sup>*</sup> p _<_ 0.1;<sup>**</sup> p _<_ 0.05;<sup>***</sup> p _<_ 0.01. DoF are degrees of freedom. The explanatory variables and their units of measurement are described in section 2.

**Table 3.** Approximate Significance of Smooth Terms in Equation (3)

|||**Dependen**<br>|**t variable:**<br>||
|---|---|---|---|---|
||**ln (ex**<br>|**ports)**<br>|**ln (GDP p**<br>|**er capita)**<br>|
||**(1)**<br>**Est. DoF**|**(2)**<br>**p-value**|**(3)**<br>**Est. DoF**|**(4)**<br>**p-value**|
|Log of population|6.907<sup>*** </sup>|0.001|4.408<sup>***</sup>|0.006|
|{_bf_(Budget coming from fees for services)} ln(budget)|1.394<sup>*</sup>|0.063|1.083|0.189|
|{_bg_(Public source of funding)} ln(budget)|1.083|0.198|1.083|0.197|
|{_bg_(Share of private sector seats in board)} ln(budget)|1.145|0.198|1.083|0.193|
|{_bg_(Budget spent of nonmatching grants)} ln(budget)|2.810<sup>**</sup>|0.013|1.083|0.720|
|{_bg_(Agency responsibility)} ln(budget)|3.076|0.126|1.083|0.187|
|{_bh_(Budget spent on marketing)} ln(budget)|2.984<sup>***</sup>|0.001|2.761<sup>** </sup>|0.029|
|{_bi_(Budget spent on export support services)} ln(budget)|1.083|0.200|1.083|0.184|
|{_bj_(Budget on non-exporters)} ln(budget)|1.441|0.791|1.084|0.578|
|{_bk_(Budget on established exporters)} ln(budget)|1.083|0.199|1.083|0.173|
|{_bl_(Budget on small firms)} ln(budget)|1.083|0.207|1.083|0.183|
|{_bm_(Budget on medium-size firms)} ln(budget)|1.083|0.200|1.083|0.191|
|{_bo_(Strategy targets exports in all sectors and destinations)} ln(budget)|1.083<sup>*</sup>|0.093|1.083|0.578|
|_bp_(_ξ_)|1.000|0.1743|1.000|0.713|
|Observations|3|71|3|71|
|Adjusted R<sup>2</sup>|0.9|98|0.9|97|

_Source_ : Authors’ nonparametric estimation of equation (3). _Note_ : Standard errors in parenthesis.<sup>*</sup> p _<_ 0.1;<sup>**</sup> p _<_ 0.05;<sup>***</sup> p _<_ 0.01. DoF are degrees of freedom. _ξ_ is the control function. The explanatory variables and their units of measurement are described in section 2.