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Estimating export-productivity cutoff contours with profit data: A novel threshold estimation approach

Peter H. Egger & Yulong Wang

Journal of International Economics2026https://doi.org/10.1016/j.jinteco.2026.104254article
AJG 4ABDC A*
Weight
0.50

Abstract

This paper develops a novel method to estimate firm-specific market-entry thresholds in international economics, allowing fixed costs to vary across firms alongside productivity. Our framework models market entry as an interaction between productivity and observable fixed-cost measures, extending traditional single-threshold models to ones with set-valued thresholds. Applying this approach to Chinese firm data, we estimate export-market entry thresholds as functions of domestic sales and surrogate variables for fixed costs. The results reveal substantial heterogeneity and threshold contours, challenging conventional single-threshold-point assumptions. These findings offer new insights into firm behavior and provide a foundation for further theoretical and empirical advancements in trade research.

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https://doi.org/https://doi.org/10.1016/j.jinteco.2026.104254

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@article{peter2026,
  title        = {{Estimating export-productivity cutoff contours with profit data: A novel threshold estimation approach}},
  author       = {Peter H. Egger & Yulong Wang},
  journal      = {Journal of International Economics},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1016/j.jinteco.2026.104254},
}

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Estimating export-productivity cutoff contours with profit data: A novel threshold estimation approach

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Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

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