Cilekoglu, Akin A.2023-06-262023-06-262023https://hdl.handle.net/2445/199861This paper examines the role of export destinations on firm upgrading. I exploit the real effective exchange rate devaluation in Spain during the Great Recession to identify the unusual export performance of manufacturing firms. Using directly observable measures of firm upgrading, I find that increased share of exports to low-income destinations in sales reduced productivity and upgrading efforts of firms. However, real effective exchange rate devaluation did not affect the share of exports to high-income destinations in sales as well as productivity and upgrading efforts. The results are consistent with the quality sorting hypothesis that suggests a positive relationship between firm productivity and product quality. The findings in this paper emphasize that export market destination is an important determinant in analysing the gains from exportin32 p.application/pdfengcc-by-nc-nd, (c) Cilekoglu, 2023http://creativecommons.org/licenses/by-nc-nd/3.0/es/ExportacionsIndústria manufactureraProductivitatExportsManufacturing industriesProductivityinfo:eu-repo/semantics/workingPaperinfo:eu-repo/semantics/openAccess