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Can Belgian firms cope with the Chinese dragon and the Asian tigers ? The export performance of multi-product firms on foreign markets

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Author Info

  • Filip Abraham

    ()
    (K.U.Leuven, Centre for Economic Studies)

  • Jan Van Hove

    ()
    (H.U.Brussel
    K.U.Leuven)

Abstract

Exporting firms are affected in many ways by competition on foreign markets. This paper focuses on the impact of Asian competition on the bilateral export performance of Belgian firms, controlling for firm level as well as destination-market characteristics. Export performance is measured in several ways, including the export intensity, the variety and quality of trade as well as the export intensity growth. Export performance appears to differ substantially across firms, across sectors and across destination markets. Our overall results indicate that both the export intensity and variety of Belgian firms’ exports are reduced by Asian competition. Especially the competitive pressure caused by mainland China and Hong Kong is strong. The competitive pressure is intense in labour-intensive sectors but also felt in a wide range of activities with a higher value added. Belgian exporters cope with foreign competition by following a variety-expansion or a quality-upgrading strategy.

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File URL: http://www.nbb.be/doc/oc/repec/reswpp/wp204En.pdf
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Bibliographic Info

Paper provided by National Bank of Belgium in its series Working Paper Research with number 204.

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Length: 46 pages
Date of creation: Oct 2010
Date of revision:
Handle: RePEc:nbb:reswpp:201010-204

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Keywords: multi-product firms; international trade; variety; quality; export intensity; competition; Asia;

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References

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  1. Thomas Chaney, 2008. "Distorted Gravity: The Intensive and Extensive Margins of International Trade," American Economic Review, American Economic Association, vol. 98(4), pages 1707-21, September.
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  4. Van Hove, Jan, 2009. "Variety and Quality in Intra-European Manufacturing Trade: The Impact of Innovation and Technological Spillovers," Working Papers 2009/43, Hogeschool-Universiteit Brussel, Faculteit Economie en Management.
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Cited by:
  1. Giorgia Giovannetti & Marco Sanfilippo, 2012. "China’s competition and the export price strategies of developed countries," FIW Working Paper series 102, FIW.
  2. Nakhoda, Aadil, 2012. "The effect of foreign competition on product switching activities: A firm level analysis," MPRA Paper 39167, University Library of Munich, Germany.

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