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The Exporter Productivity Premium along the Productivity Distribution Evidence from Unconditional Quantile Regression with Firm Fixed Effects

Author

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  • David Powell
  • Joachim Wagner

Abstract

One of the stylized facts from the literature on international activities of heterogeneous firms is the existence of a positive exporter productivity premium — on average, exporting firms are more productive than firms that sell on the national market only. In this paper, the authors look at the productivity distribution of both exporting and non-exporting firms in German manufacturing industries. They recognize that it is potentially important to condition on firm fixed effects for estimation of this exporter premium. They apply a new unconditional quantile estimation technique for panel data to condition on firm fixed effects while estimating the exporter premium throughout the entire productivity distribution. They find that the premium is positive for all productivity levels, but highest at the lowest quantiles. These results support theoretical models which suggest that there is a division in productivity between exporters and non-exporters. Mean regression is incapable of detecting this dimension of firm heterogeneity.

Suggested Citation

  • David Powell & Joachim Wagner, 2011. "The Exporter Productivity Premium along the Productivity Distribution Evidence from Unconditional Quantile Regression with Firm Fixed Effects," Working Papers WR-837, RAND Corporation.
    • Handle: RePEc:ran:wpaper:wr-837
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    Cited by:

    1. Heather D Gibson & Georgia Pavlou, 2017. "Exporting and performance:evidence from Greek firms," Economic Bulletin, Bank of Greece, issue 45, pages 7-30, July.
    2. Neil Foster-McGregor & Anders Isaksson & Florian Kaulich, 2015. "Importing, exporting and the productivity of services firms in Sub-Saharan Africa," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 24(4), pages 499-522, June.
    3. Joachim Wagner, 2013. "Are low-productive exporters marginal exporters? Evidence from Germany," Economics Bulletin, AccessEcon, vol. 33(1), pages 467-481.
    4. Joachim Wagner, 2015. "New Methods for the Analysis of Links between International Firm Activities and Firm Performance: A Practitioner's Guide," The World Economy, Wiley Blackwell, vol. 38(4), pages 704-715, April.
    5. Hernandez, Pedro J., 2013. "A Note on the Link between Firm Size and Exports," MPRA Paper 51576, University Library of Munich, Germany.
    6. Hernández, Pedro J., 2013. "A note on the link between firm size and exports," UMUFAE Economics Working Papers 37132, DIGITUM. Universidad de Murcia.
    7. Riccardo Crescenzi & Mara Giua, 2016. "The EU Cohesion Policy in context: Does a bottom-up approach work in all regions?," Environment and Planning A, , vol. 48(11), pages 2340-2357, November.
    8. Gabriel Felbermayr & Andreas Hauptmann & Hans-Jörg Schmerer, 2014. "International Trade and Collective Bargaining Outcomes: Evidence from German Employer–Employee Data," Scandinavian Journal of Economics, Wiley Blackwell, vol. 116(3), pages 820-837, July.
    9. Joachim Wagner, 2016. "International Trade and Firm Performance: A Survey of Empirical Studies since 2006," World Scientific Book Chapters, in: Microeconometrics of International Trade, chapter 2, pages 43-87, World Scientific Publishing Co. Pte. Ltd..

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    More about this item

    Keywords

    exporter productivity premium; quantile regression; fixed effects; unconditional quantile treatment effects;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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