Do Exports Generate Higher Productivity? Evidence from Slovenia

Published on Sep 1, 2007in Journal of International Economics2.22
· DOI :10.1016/j.jinteco.2007.03.003
Jan De Loecker15
Estimated H-index: 15
(NYU: New York University)
I use matched sampling techniques to analyze whether firms that start exporting become more productive. To this end, I use micro data of Slovenian manufacturing firms operating between the period 1994-2000. I estimate total factor productivity using the Olley-Pakes correction for sample selection and for potential endogeneity of the input factors. In most sectors I find evidence supporting the learning by exporting hypothesis controlling for the self-selection process explicitly. Exporting firms become on average 20 percent more productive once they start exporting. This result is robust to other controls that may be associated with increased productivity, such as private ownership. Finally, I introduce export as a state variable in the dynamic program of the firm and allow exporting firms to face different market structures and factor prices. This leads to a modification in the Olley and Pakes estimation algorithm. The results of learning by exporting are - if anything - even stronger.
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  • Citations (708)
Published on Jan 1, 2008in Econometrica4.28
Jonathan Eaton48
Estimated H-index: 48
(PSU: Pennsylvania State University),
Samuel Kortum32
Estimated H-index: 32
(U of C: University of Chicago),
Francis Kramarz36
Estimated H-index: 36
(ENSAE ParisTech)
We examine the sales of French manufacturing firms in 113 destinations, including France itself. Several regularities stand out: (1) the number of French firms selling to a market, relative to French market share, increases systematically with market size; (2) sales distributions are very similar across markets of very different size and extent of French participation; (3) average sales in France rise very systematically with selling to less popular markets and to more markets. We adopt a model ...
Published on Jan 1, 2007in The World Economy1.09
Joachim Wagner43
Estimated H-index: 43
While the role of exports in promoting growth in general, and productivity in particular, has been investigated empirically using aggregate data for countries and industries for a long time, only recently have comprehensive longitudinal data at the firm level been used to look at the extent and causes of productivity differentials between exporters and their counterparts which sell on the domestic market only. This paper surveys the empirical strategies applied, and the results produced, in 45 m...
Published on Jan 1, 2007in World Bank Economic Review1.80
Alessandro Nicita17
Estimated H-index: 17
(World Bank),
Marcelo Olarreaga25
Estimated H-index: 25
The database described in this article provides researchers with a broad set of data on trade, production, and protection for 28 manufacturing sectors at the three-digit level of the international standard industrial classification. The database covers up to 100 developing and developed countries over the period 1976-2004, but data availability varies by country and year. The trade, production, and protection database includes annual data on trade flows (exports and imports), domestic production...
Published on Jan 1, 2007in Handbook of Econometrics
Daniel A. Ackerberg16
Estimated H-index: 16
C. Lanier Benkard16
Estimated H-index: 16
+ 1 AuthorsAriel Pakes43
Estimated H-index: 43
This paper outlines recently developed techniques for estimating the primitives needed to empirically analyze equilibrium interactions and their implications in oligopolistic markets. It is divided into an introduction and three sections; a section on estimating demand functions, a section on estimating production functions, and a section on estimating "dynamic" parameters (parameters estimated through their implications on the choice of controls which determine the distribution of future profit...
Published on Jun 1, 2006in European Journal of Political Economy1.78
Jan De Loecker1
Estimated H-index: 1
(Katholieke Universiteit Leuven),
Jozef Konings34
Estimated H-index: 34
(Katholieke Universiteit Leuven)
This paper studies whether job reallocation in Slovenia, a post-socialist economy, has been associated with gains in total factor productivity (TFP). We document the importance of entry and exit in job reallocation and show that TFP has increased mainly due to existing firms' increasing efficiency and through net entry of firms. Underlying aggregate TFP growth is job destruction by state firms and reallocation of employment to private firms.
Published on Feb 1, 2006
Alessandro Nicita1
Estimated H-index: 1
Madagascar's textile and apparel industry has been among the fastest growing in Sub-Saharan Africa. Fueled by low labor costs, a fairly productive labor force, and preferential access to industrial countries, Madagascar's exports of textile and apparel products grew from about US$45 million in 1990 to almost half a billion in 2001. The impact of this export surge has been large in terms of employment and wages, but less so in terms of poverty reduction. To address the concern of whether the poor...
Published on Dec 1, 2005in Journal of International Economics2.22
Johannes Van Biesebroeck20
Estimated H-index: 20
(U of T: University of Toronto)
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Published on Nov 1, 2005in Canadian Journal of Economics
Roberto Alvarez E.17
Estimated H-index: 17
(University of Chile),
Ricardo A. López11
Estimated H-index: 11
(IU: Indiana University)
Recent empirical evidence documents the superior characteristics of exporters relative to non-exporters. Three explanations for this phenomenon have been proposed: self-selection; learning-by-exporting; and conscious self-selection. We test these three hypotheses using plant-level data from Chile. We find that plants that enter international markets show superior initial performance compared with non-exporters, consistent with self-selection; we observe increases in productivity after plants beg...
Published on Mar 1, 2005
Ana M. Fernandes17
Estimated H-index: 17
(World Bank),
Alberto Isgut4
Estimated H-index: 4
The empirical evidence on whether participation in export markets increases plant-level productivity has been inconclusive so far. The authors explain this inconclusiveness by drawing on Arrow's (1962) characterization of learning-by-doing, which suggests focusing on young plants and using measures of export experience rather than export participation. They find strong evidence of learning-by-exporting for young Colombian manufacturing plants between 1981 and 1991: total factor productivity incr...
Published on Feb 2, 2005in Fiscal Studies1.16
Richard Blundell74
Estimated H-index: 74
(UCL: University College London),
Monica Costa Dias12
Estimated H-index: 12
(UCL: University College London)
This paper presents a review of non-experimental methods for the evaluation of social programmes. We consider matching and selection methods and analyse each for cross-section, repeated cross-section and longitudinal data. The methods are assessed drawing on evidence from labour market programmes in the UK and in the US.
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Reliability of electricity supply is one of pressing challenges to many micro and small enterprises (MSEs) in developing countries. MSEs play a pivotal role in employment generation in these countries, but productivity of MSEs is relatively low. Little is known about how blackouts affect performance of MSEs. This paper is the first study to estimate the impact of power blackouts on productivity of manufacturing MSEs and to discuss the role of the government in addressing problem. We employ a pse...
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Traditional heterogeneous firms and trade models predict no causal relationship between firms' exports and domestic sales. This paper, using a rich dataset on Turkish firms for the 2005-14 period, analyzes the relationship between firm-product sales in different markets for the first time in the literature to identify the channels that link exports and domestic sales. First, I use an instrumental variables strategy and establish that an exogenous doubling of exports increases a firm's domestic s...
Chrysovalantis Amountzias2
Estimated H-index: 2
(University of Hertfordshire)
This paper investigates the pricing decisions across the manufacturing sectors of 19 EU countries over 1995–2014. The markup formulation of De Loecker and Warzynski (Am Econ Rev 102(6):2437–2471, 2012) is employed in order to estimate the price–cost margin of 10 2-digit NACE Rev.2 level manufacturing sectors and conclude whether the selling price of the final product exceeds the marginal cost of production. Subsequently, the pricing decisions of the constituent industries are tested with respect...
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Gen-Fu Feng5
Estimated H-index: 5
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Mingbo Zheng1
Estimated H-index: 1
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+ 2 AuthorsYin E. Chen1
Estimated H-index: 1
(CSUST: Changsha University of Science and Technology)
Abstract This paper investigates the effect of globalization on innovation by using a combined dataset of 596,806 Chinese manufacturing firms with 1,993,154 observations and provincial globalization indices from 1998-2009. The empirical findings suggest that overall provincial globalization is associated with better innovation performance for Chinese firms. More specifically, economic, social, and political globalization, present positive impacts on technological innovation. Interestingly, throu...
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Toshihiro Okubo16
Estimated H-index: 16
(Keio: Keio University),
Eiichi Tomiura11
Estimated H-index: 11
(Hitotsubashi University)
The international trade literature confirms that the average productivity of exporters is higher than that of non-exporters, while economic geography studies establish that urban firms tend to be more productive than rural ones. By introducing region-specific transportation costs in a Melitz-type heterogeneous firm trade model, the theory predicts that the minimum threshold productivity level for export is higher but that for survival by serving the local market is lower in the periphery region ...
Published on Jan 30, 2019in Journal of International Business Studies7.72
Sea Jin Chang25
Estimated H-index: 25
This study examines the decision to convert international joint ventures to either foreign or local wholly owned entities and the subsequent impact on performance from the perspective of incomplete contract theory. With China’s relaxation of the joint venture requirement, foreign partners are more likely to take full control and thereby improve performance in provinces with fewer institutional barriers and industries with high intangible asset intensity, while local partners are more likely to d...
Valeria Gattai4
Estimated H-index: 4
(University of Milan),
Rajssa Mechelli1
Estimated H-index: 1
(UCSC: Catholic University of the Sacred Heart),
Piergiovanna Natale5
Estimated H-index: 5
(University of Milan)
groups of former Soviet states, designated CIS, Developed and Developing. Using Orbis data, we provide within-group and between-group results on the effects of outward FDI (OFDI) and inward FDI (IFDI) on firm-level innovation. As the most notable finding, OFDI firms innovate more than IFDI firms, which in turn innovate more than non-FDI firms. The innovation effect of OFDI is the largest for firms from the Developing economies, followed by the Developed and CIS countries. The innovation effect o...
Published on Jul 10, 2019in Oxford Bulletin of Economics and Statistics0.99
Robert J. Elliott48
Estimated H-index: 48
(University of Birmingham),
Liza Jabbour5
Estimated H-index: 5
(University of Birmingham),
Enrico Vanino1
Estimated H-index: 1
(LSE: London School of Economics and Political Science)
Published on Jul 2, 2019
Jacek Pietrucha2
Estimated H-index: 2
Rafał Żelazny1
Estimated H-index: 1
AbstractAs a consequence of globalisation, economic growth and productivity have become more sensitive to developments beyond national frontiers. This paper explores trade (import and export) and foreign direct investment (FDI) as channels of international total factor productivity (TFP) spillovers. FDI and trade are potentially important sources of productivity growth; however, empirical literature is inconclusive as to the nature and extent of spillovers and does not simultaneously cover all t...
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