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The U-Shaped Productivity Dynamics of French Exporters

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Author Info

  • Flora Bellone

    ()

  • Patrick Musso
  • Lionel Nesta
  • Michel Quere

Abstract

Sunk costs due to entry into foreign markets are used as the main justification of the relationship between firm productivity and exports. We use a large-scale dataset on French manufacturing firms to evaluate how sunk costs affect the productivity of new exporters. We find that the typical productivity dynamics of a new exporter is U-shaped. Prior to entry into export markets, firm productivity temporarily decreases. It recovers contemporaneously with entry, as the benefits from sales to foreign markets are harvested. This pattern is more pronounced for intensively exporting firms and for firms operating in capital intensive or high technology sectors.

(This abstract was borrowed from another version of this item.)

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File URL: http://hdl.handle.net/10.1007/s10290-008-0164-x
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Bibliographic Info

Article provided by Springer in its journal Review of World Economics.

Volume (Year): 144 (2008)
Issue (Month): 4 (December)
Pages: 636-659

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Handle: RePEc:spr:weltar:v:144:y:2008:i:4:p:636-659

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Related research

Keywords: Trade; firm productivity; export strategy; learning; firm level data; France;

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References

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Citations

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Cited by:
  1. Flora Bellone & Patrick Musso & Lionel Nesta & Stefano Schiavo, 2010. "Financial Constraints and Firm Export Behaviour," The World Economy, Wiley Blackwell, vol. 33(3), pages 347-373, 03.
  2. Minetti, Raoul & Zhu, Susan Chun, 2011. "Credit constraints and firm export: Microeconomic evidence from Italy," Journal of International Economics, Elsevier, vol. 83(2), pages 109-125, March.
  3. Vu, Van Huong, 2012. "Higher productivity in Exporters: self-selection, learning by exporting or both? Evidence from Vietnamese manufacturing SMEs," MPRA Paper 40708, University Library of Munich, Germany.
  4. Francesco Serti & Chiara Tomasi, 2008. "Self-Selection and Post-Entry Effects of Exports: Evidence from Italian Manufacturing Firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 144(4), pages 660-694, December.
  5. Matthieu Crozet & Isabelle Méjean & Soledad Zignago, 2008. "Plus grandes, plus fortes, plus loin... Performances relatives des firmes exportatrices françaises," Working Papers 2008-26, CEPII research center.
  6. Nakhoda, Aadil, 2012. "The influence of financial leverage of firms on their international trading activities," MPRA Paper 35765, University Library of Munich, Germany.
  7. Lionel Nesta & Flora Bellone & Patrick Musso & Stefano Schiavo, 2008. "Financial Constraints as a Barrier to Export Participation," Sciences Po publications info:hdl:2441/9797, Sciences Po.
  8. Kent Eliasson & Pär Hansson & Markus Lindvert, 2012. "Do firms learn by exporting or learn to export? Evidence from small and medium-sized enterprises," Small Business Economics, Springer, vol. 39(2), pages 453-472, September.
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  10. Joachim Wagner, 2008. "Exports, Imports, and Productivity at the Firm Level. An International Perspective: Introduction by Guest Editor," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 144(4), pages 591-595, December.
  11. Verardi, Vincenzo & Wagner, Joachim, 2010. "Productivity Premia for German Manufacturing Firms Exporting to the Euro-Area and Beyond: First Evidence from Robust Fixed Effects Estimations," IZA Discussion Papers 4964, Institute for the Study of Labor (IZA).
  12. Fabling, Richard & Sanderson, Lynda, 2013. "Exporting and firm performance: Market entry, investment and expansion," Journal of International Economics, Elsevier, vol. 89(2), pages 422-431.

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