Do backward linkages in export processing zones increase dynamically? Firm-level evidence from Costa Rica

This study statistically examines how the passage of time affects backward linkage creation in export processing zones. Using data collected by the government of Costa Rica, the study finds after controlling for a number of industry- and firm-specific characteristics that backward linkages at the firm level do in fact tend to increase with time, albeit by only a fraction of a percentage point per year. This result seems robust to the measure that the study uses to proxy for backward linkage formation and to several econometric specifications.