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The value of international standards certification: Evidence on export and firm performance from a security enforcement on borders

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  • Chou, Shu-Ching
  • Kuo, Yen-Hui
  • Cheng, Yu-Hsiu

Abstract

Globally, economic growth is promoted through regional economic integration, and governments actively try to improve the security and efficiency of international trade and border management by optimizing the conditions for international trade. The World Trade Organization (WTO) introduced the Authorized Economic Operator (AEO) certification system to improve the efficiency of customs clearance and to ensure the security of the global supply chain. Using a sample of Taiwanese-listed firms that attained AEO certification from 2009 to 2018, this study investigates the influence of AEO certification on their export sales and corporate performance. The empirical results show that AEO-certified firms increase their ratio of export sales and the scope of export destination regions. However, AEO-certified firms can not improve their operating and market performance significantly, except for low-performance firms in the accreditation year. This study also uses the two-stage least square regressions (2SLS) method and the propensity score matching method to conduct the regression analysis. The regression results are consistent with the main findings. The findings can be used for reference by firms seeking to expand international trade and by governments to promote the country’s international trading.

Suggested Citation

  • Chou, Shu-Ching & Kuo, Yen-Hui & Cheng, Yu-Hsiu, 2024. "The value of international standards certification: Evidence on export and firm performance from a security enforcement on borders," The Quarterly Review of Economics and Finance, Elsevier, vol. 98(C).
    • Handle: RePEc:eee:quaeco:v:98:y:2024:i:c:s1062976924001327
    DOI: 10.1016/j.qref.2024.101926
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    More about this item

    Keywords

    AEO certification; Certification effect; Export; Firm performance;
    All these keywords.

    JEL classification:

    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation
    • G38 - Financial Economics - - Corporate Finance and Governance - - - Government Policy and Regulation
    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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