AbstractThis paper investigates the importance of firm heterogeneity for our understanding of the aggregate volume of cross-country multinational sales. Recent theoretical literature points out a sorting out firms with respect to their internationalization strategy according to their productivity. Using the firm level data from German firms' activities, we find a strong effect of firms' size on internationalization pattern. Moreover, we show that most of variation of the aggregate volume of multinational sales is due to variation in the number of firms participating in the market.
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Bibliographic InfoPaper provided by Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University in its series CEI Working Paper Series with number 2006-7.
Length: 20 p.
Date of creation: Oct 2006
Date of revision:
Gravity equation; multinational firms; heterogeneity;
Find related papers by JEL classification:
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
- C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-05-26 (All new papers)
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