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Domestic transport infrastructure and firms’ export market participation

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  • Pedro Albarran
  • Raquel Carrasco
  • Adelheid Holl

Abstract

Investment in transport infrastructure reduces the cost of distance and enables firms to establish contacts over larger distances. Using data from a panel of Spanish manufacturing firms and geographic information system techniques, this article studies the impact of domestic transport cost reductions on firms’ export market participation, taking into account the role of entry costs and other firm characteristics. We estimate dynamic probability models, controlling for the unobserved heterogeneity of firms and for the simultaneity of firms’ export and location decisions. Our results demonstrate a positive effect of domestic transport infrastructure improvements on small and medium-sized firms’ probability of exporting. Copyright Springer Science+Business Media, LLC. 2013

Suggested Citation

  • Pedro Albarran & Raquel Carrasco & Adelheid Holl, 2013. "Domestic transport infrastructure and firms’ export market participation," Small Business Economics, Springer, vol. 40(4), pages 879-898, May.
    • Handle: RePEc:kap:sbusec:v:40:y:2013:i:4:p:879-898
    DOI: 10.1007/s11187-011-9393-9
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    3. Xu, Hangtian, 2016. "Domestic railroad infrastructure and exports: Evidence from the Silk Route," China Economic Review, Elsevier, vol. 41(C), pages 129-147.
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    6. Tsekeris, Theodore, 2017. "Domestic transport effects on regional export trade in Greece," Research in Transportation Economics, Elsevier, vol. 61(C), pages 2-14.
    7. Dongxiao Niu & Weizeng Sun & Siqi Zheng, 2020. "Travel costs, trade, and market segmentation: Evidence from China's high‐speed railway," Papers in Regional Science, Wiley Blackwell, vol. 99(6), pages 1799-1825, December.
    8. Ma, Liya & Niu, Dongxiao & Sun, Weizeng, 2021. "Transportation infrastructure and entrepreneurship: Evidence from high-speed railway in China," China Economic Review, Elsevier, vol. 65(C).
    9. Yasir Khan & Taimoor Hassan & Cai Shukai & Hana Oubaih & Muhammad Nisar Khan & Jawed Kootwal & Ubaid Ur Rahman Rehimi, 2022. "The nexus between infrastructure development, economic growth, foreign direct investment, and trade: an empirical investigation from China’s regional trade data," SN Business & Economics, Springer, vol. 2(7), pages 1-31, July.
    10. Child, John & Karmowska, Joanna & Shenkar, Oded, 2022. "The role of context in SME internationalization – A review," Journal of World Business, Elsevier, vol. 57(1).
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    More about this item

    Keywords

    Export decisions; Road transport infrastructure; Accessibility; Dynamic panel data; Geographic information systems; F14; R1; R4; L26;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • R4 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Transportation Economics
    • L26 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Entrepreneurship

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