Distance to Core and Selection of Export Products-Destinations

Abstract

This paper examines?aspects of heterogeneous multi-product firms that are seldom studied in the?empirical literature, specifically the effects of skewness in export sales towards the best-performing products (core products) on the creation of new commercial product-country links. Additionally, this paper examines the factors that affect the differences in the trading of core products compared to fringe products.?The results?reveal that if the distance to the core increases by one standard deviation, then the probability of creating a new product-country link decreases by 3.5 percent. Distance to the core is negatively correlated with the ratio of the importing-country?s demand at the product-level.