Performance Differences between Exporters and Non-Exporters: the Case of Portugal

In the recent economic context in most developed economies, marked by a strong crisis and contraction of domestic demand, internationalization has been an imperative of survival for most companies. This paper aims to find out if there are significant performance differences between exporters and non-exporters in Portugal and if those performance differences vary according to the various measures of performance used in the study. This is relevant since extant literature leads to contrasting findings in the aspects under analysis (productivity and profitability) and because there are no studies on this theme focused solely on the Portuguese case. Still, most of the literature agrees that exporters display superior productivity, larger size and greater age than non-exporters, as well as that they pay higher wages to their workers. Regarding profitability, no clear pattern has emerged yet between these two types of firm. In order to test different hypotheses, with a sample of Portuguese manufacturing firms and considering the period 2008 to 2012, we perform OLS and Pooled OLS regressions for two measures: productivity and profitability. For productivity, the results are clear: being an exporter per se has a positive impact. This means that, in our sample, exporters are more productive than their purely domestic counterparts. For profitability, whilst the results mostly confirm our hypotheses, they are not as consistent as those for the other measure. Our findings are overall in line with the majority of the literature reviewed and the hypotheses postulated.