Exporting, R&D Investment and Firm Survival
AbstractThis paper examines the effect of exporting on firm survival for a panel of Indian IT firms. We show that exporting has competing effects on firm survival. On the one hand, exporting and investing in productivity are complementary activities, while on the other exporting activity is an additional source of uncertainty for the firm. We show that both effects influence survival, but operate at different points in time. Specifically, the hazard facing exporters is higher than non-exporters in the initial phase following entry into the export market, reflecting the fact that exporters are particularly vulnerable to shocks in the start-up phase. However, over time, exporters benefit more from productivity gains than non-exporters and the hazard facing exporters falls below that confronting non-exporters.
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Bibliographic InfoPaper provided by Monash University, Department of Economics in its series Monash Economics Working Papers with number 39-11.
Length: 37 pages
Date of creation: Dec 2011
Date of revision:
Contact details of provider:
Postal: Department of Economics, Monash University, Victoria 3800, Australia
Web page: http://www.buseco.monash.edu.au/eco/
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Find related papers by JEL classification:
- L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
- L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
- C41 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Duration Analysis; Optimal Timing Strategies
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-01-10 (All new papers)
- NEP-BEC-2012-01-10 (Business Economics)
- NEP-CSE-2012-01-10 (Economics of Strategic Management)
- NEP-INO-2012-01-10 (Innovation)
- NEP-INT-2012-01-10 (International Trade)
- NEP-TID-2012-01-10 (Technology & Industrial Dynamics)
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