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The Role of Management in the Internationalization Process of a Firm

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  • Yalcin, Erdal
  • Sala, Davide

Abstract

In this paper we are able to analyze firms' entry decision into the export market. In contrast to previous studies it is possible to control for the effects of management characteristics and human capital variables, besides commonly used firm characteristics. We first motivate our empirical strategy by presenting a theoretical partial equilibrium model which accounts for management characteristics as an input factor. Applying an empirical strategy suggested by Chamberlain (1980) we are able to affirm the robustness of firm productivity and fixed costs as explaining variables for export decisions. Unobserved heterogeneity turns out to be systematically related to management characteristics, in particular management knowhow. By reducing the sample only to firms which enter the export market during the considered period, the type of management promotion (internal promotion opposed to e.g. external promotion) is identified to increase the likeliness of exporting. --

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Bibliographic Info

Paper provided by Verein für Socialpolitik / German Economic Association in its series Annual Conference 2011 (Frankfurt, Main): The Order of the World Economy - Lessons from the Crisis with number 48706.

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Date of creation: 2011
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Handle: RePEc:zbw:vfsc11:48706

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Web page: http://www.socialpolitik.org/
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Related research

Keywords: Export Decision; Internationalization; Management; Productivity;

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  1. Roberts, Mark J & Tybout, James R, 1997. "The Decision to Export in Colombia: An Empirical Model of Entry with Sunk Costs," American Economic Review, American Economic Association, vol. 87(4), pages 545-64, September.
  2. Bell, Linda & Smith, Nina & Smith, Valdemar & Verner, Mette, 2008. "Gender differences in promotion into top-management jobs," Working Papers 08-21, University of Aarhus, Aarhus School of Business, Department of Economics.
  3. Sebastian Krautheim, 2007. "Gravity and Information: Heterogeneous Firms, Exporter Networks and the 'Distance Puzzle'," Economics Working Papers ECO2007/51, European University Institute.
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