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Exporting Raises Productivity in Sub-Saharan African Manufacturing Plants

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Author Info
Johannes Van Biesebroeck

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Abstract

Proponents of trade liberalization argue that it will force firms to produce closer to the production possibility frontier and that the frontier will move out faster. In particular, plants that export will achieve a higher productivity level. However intuitive the argument, empirical evidence is meager. This hypothesis is examined by calculating the effect of export status on productivity for a panel of manufacturing plants in nine African countries. The results indicate that exporters in these countries are more productive, replicating a similar finding for developed countries. More importantly, exporters increase their productivity advantage after entry into the export market. While the first finding can be explained by selection---only the most productive firms engage in exporting---the latter cannot. The results are robust when unobserved productivity differences and self-selection into the export market are controlled for using different econometric methods. Scale economies are shown to be an important channel for the productivity advance. Credit constraints and contract enforcement problems prevent plants that only produce for the domestic market to fully exploit scale economies.

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Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10020.

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Date of creation: Oct 2003
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Handle: RePEc:nbr:nberwo:10020

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Find related papers by JEL classification:
F14 - International Economics - - Trade - - - Country and Industry Studies of Trade
O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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  16. Johannes Van Biesebroeck, 2004. "Robustness of Productivity Estimates," NBER Working Papers 10303, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Fugazza, Marco & Robert-Nicoud, Frédéric, 2006. "Can South-South Trade Liberalisation Stimulate North-South Trade?," CEPR Discussion Papers 5699, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
  2. Davide Castellani & Francesco Serti & Chiara Tomasi, 2008. "Firms in International Trade: Importers and Exporters Heterogeneity in the Italian Manufacturing Industry," LEM Papers Series 2008/04, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy. [Downloadable!]
  3. Joze P. Damijan & Crt Kostevc, 2005. "Performance on Exports: Continuous Productivity Improvements or Capacity Utilization," LICOS Discussion Papers 16305, LICOS - Centre for Institutions and Economic Performance, K.U.Leuven. [Downloadable!]
  4. Francesco Serti & Chiara Tomasi, 2008. "Firm Heterogeneity: do destinations of exports and origins of imports matter?," LEM Papers Series 2008/14, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy. [Downloadable!]
  5. Schank, Thorsten & Schnabel, Claus & Wagner, Joachim, 2004. "Exporting Firms Do Not Pay Higher Wages, Ceteris Paribus. First Evidence from Linked Employer-Employee Data," IZA Discussion Papers 1185, Institute for the Study of Labor (IZA). [Downloadable!]
    Other versions:
  6. Ana M. Fernandes & Alberto E. Isgut, 2005. "Learning-by-Doing, Learning-by-Exporting, and Productivity: Evidence from Colombia," DEGIT Conference Papers c010_018, DEGIT, Dynamics, Economic Growth, and International Trade. [Downloadable!]
    Other versions:
  7. Thorsten Schank & Claus Schnabel & Joachim Wagner, 2006. "Do exporters really pay higher wages? First evidence from German linked employer-employee data," Working Paper Series in Economics 28, University of Lüneburg, Institute of Economics. [Downloadable!]
    Other versions:
  8. Pedro S. Martins & Yong Yang, 2007. "The Impact of Exporting on Firm Productivity: A Meta-Analysis," Working Papers 6, Queen Mary, University of London, School of Business and Management, Centre for Globalisation Research. [Downloadable!]
  9. Joachim Wagner, 2005. "Exports and Productivity: A survey of the evidence from firm level data," Working Paper Series in Economics 4, University of Lüneburg, Institute of Economics. [Downloadable!]
    Other versions:
  10. Albert Park & Dean Yang & Xinzheng Shi & Yuan Jiang, 2006. "Exporting and Firm Performance: Chinese Exporters and the Asian Financial Crisis," Working Papers 549, Research Seminar in International Economics, University of Michigan. [Downloadable!]
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  11. Mahmut Yasar & Carl H. Nelson & Roderick Rejesus, 2006. "Productivity and Exporting Status of Manufacturing Firms: Evidence from Quantile Regressions," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 142(4), pages 675-694, December. [Downloadable!] (restricted)
    Other versions:
  12. Mahmut Yasar & Catherine J. Morrison Paul, 2005. "Foreign Technology Transfer and Productivity: Evidence from a Matched Sample," Emory Economics 0514, Department of Economics, Emory University (Atlanta). [Downloadable!]
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  13. Torfinn Harding and Jørn Rattsø, 2005. "The barrier model of productivity growth: South Africa," Discussion Papers 425, Research Department of Statistics Norway. [Downloadable!]
    Other versions:
  14. Isgut, Alberto & Fernandes, Ana, 2007. "Learning-by-Exporting Effects: Are They for Real?," MPRA Paper 3121, University Library of Munich, Germany. [Downloadable!]
  15. Crt Kostevc, 2005. "Performance of Exporters: Scale Effects or Continuous Productivity Improvements," LICOS Discussion Papers 15905, LICOS - Centre for Institutions and Economic Performance, K.U.Leuven. [Downloadable!]
  16. 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. [Downloadable!] (restricted)
    Other versions:
  17. Sarah Stolting, 2009. "International Trade and Growth: The Impact of Seletion and Imitation," Economics Working Papers ECO2009/21, European University Institute. [Downloadable!]
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