Do Firms Learn by Exporting or Learn to Export : Evidence from Senegalese Manufacturers’ Plants

The increasing number of literature investigating the impact of trade openness on firm efficiency has not yet provided a definite prediction on the direction of causality. This paper investigated the relation between exporting and productivity on the Senegalese manufacturing sectors. Using a unique firm-level panel data for the period 1998-2011, a productivity and exporting dynamics is estimated, controlling other unobserved effects, using simultaneous functions. The results indicate the evidence of both self-selection of the most efficient firms entered into the export market and the effect of learning in the export market. The findings suggest that workers’ qualification and access to Patents and Licences have a positive effect on the process of learning. Also, small firms particularly learn more from exporting. From a policy perspective, this evidence of learning-by-exporting suggests that Senegal has much to gain from promoting its manufacturing sector towards exporting by supporting domestic firms to overcome the barriers to enter into foreign market, particularly by investing on skilled workers and promote access to Patents and Licences as well as disseminating benefits arising from exporting to non exporters.