Export Credit Guarantees and Export Performance: An Empirical Analysis for Germany
AbstractRecent literature finds that exporters are particularly vulnerable to financial market frictions. As a consequence, exports may be lower than their efficient levels. For this reason, many countries support exporters by underwriting export credit guarantees. The empirical evidence on the effects of those policies is, however, very limited. In this paper, we use sectoral data on export credit guarantees issued by the German government. We investigate whether those guarantees indeed do increase exports and whether they remedy the export-restricting effect of credit market imperfections both on the sectoral and on the export-market levels. Exploiting the sectoral structure of a rich three-way panel data set of German exports, we control for unobserved heterogeneity on the country-year, sector-year and country-sector dimensions. We document a robust export-increasing effect of guarantees. There is some evidence that the effect is larger for export markets with poor financial institutions and in sectors that rely more on external finance.
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Bibliographic InfoArticle provided by Wiley Blackwell in its journal The World Economy.
Volume (Year): 36 (2013)
Issue (Month): 8 (08)
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Web page: http://www.blackwellpublishing.com/journal.asp?ref=0378-5920
Other versions of this item:
- Gabriel J. Felbermayr & Erdal Yalcin, 2011. "Export Credit Guarantees and Export Performance:An Empirical Analysis for Germany," Ifo Working Paper Series Ifo Working Paper No. 116, Ifo Institute for Economic Research at the University of Munich.
- Felbermayr, Gabriel & Yalcin, Erdal, 2013. "Export credit guarantees and export performance: An empirical analysis for Germany," Munich Reprints in Economics 20348, University of Munich, Department of Economics.
- F10 - International Economics - - Trade - - - General
- F14 - International Economics - - Trade - - - Empirical Studies of Trade
- F36 - International Economics - - International Finance - - - Financial Aspects of Economic Integration
- G20 - Financial Economics - - Financial Institutions and Services - - - General
- G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
- G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
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