The Export Promoting Effect of Emigration: Evidence from Denmark
AbstractThe theoretical claim that ethnic networks encourage trade has found broad empirical support in the literature on migration, business networks and international trade. Ethnic networks matter for the exporting firm, as they exhibit the potential to lower fixed and variable cost of exporting. This paper provides a first attempt to identify the export-promoting effect of emigration on the firm level. Using detailed Danish firm-level data, we can parsimoniously control for export determinants other than emigration, unobserved heterogeneity at the firm level, as well as for self-selection of firms into exporting. Additionally accounting for taste similarity between Denmark and its trade partners, our findings suggest a positive effect of emigration on Danish manufacturing trade within Europe, thereby corroborating preceding studies on aggregate data. Nevertheless, as a novel insight, our analysis reveals that the only beneficiaries of emigration are small enterprises.
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Bibliographic InfoPaper provided by FIW in its series FIW Working Paper series with number 070.
Date of creation: Jun 2011
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Postal: FIW Project Office Austrian Institute of Economic Research Arsenal Objekt 20 A-1030 Vienna
Other versions of this item:
- Hiller, Sanne, 2011. "The Export Promoting Effect of Emigration: Evidence from Denmark," Working Papers 11-8, University of Aarhus, Aarhus School of Business, Department of Economics.
- Hiller, Sanne, 2011. "The export promoting effect of emigration: Evidence from Denmark," Center for European, Governance and Economic Development Research Discussion Papers 126, University of Goettingen, Department of Economics.
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
- F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-06-18 (All new papers)
- NEP-EEC-2011-06-18 (European Economics)
- NEP-EUR-2011-06-18 (Microeconomic European Issues)
- NEP-MIG-2011-06-18 (Economics of Human Migration)
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