Analysing the role of psychic distance on the export behaviour of Chilean service exporters

Abstract

This paper demonstrates the export behaviour of firms as a nonlinear dynamic behaviour which shows both 'continuity' and 'discontinuity' in their export engagements depending on their market diversification. Likewise, this behaviour is also moderated by psychic distance. The findings of this research promote export designing, the building of an appropriate international market competitiveness and growth-focused policies for the Chilean service sector. Such policies should be targeted to build a conductive local ecosystem supporting the reduction of the early mortality in young firms in process of internationalisation and thus reducing the rate of discontinuing export by mature firms and therefore extending the longevity of mature firms in the international market. Such policies should be devised on short, medium and long-term perspectives. These policies can be equally important to the service sectors in other developing countries facing similar challenges.