Trade and Productivity in a Transition Economy: the Role of Industry and Export Destination

Abstract

This paper focuses on the joint role of industry technology intensity and export market characteristics in the analysis of export-related productivity gains. Using a unique database of Ukrainian manufacturing firms in 2000-06, we classify all manufacturing sectors according to their technology intensity and estimate destination-specific learning by exporting effects separately for firms operating in high and low technology sectors. New exporters in high technology sectors enjoy robust long-term productivity growth premia when targeting advanced export markets, consistent with learning through exports. Export entrants in low technology sectors, instead, enjoy mostly short-term productivity improvements regardless of the export destination. Our findings suggest that the systematic distinction between the technology intensity of various industries is a relevant dimension for empirical studies on destination-specific learning by exporting.