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Internationalization choices: an ordered probit analysis at industry level

Author

Listed:
  • Filomena Pietrovito

    (Università degli Studi del Molise)

  • Alberto Franco Pozzolo

    (Università degli Studi del Molise)

  • Luca Salvatici

    (Università degli Studi Roma Tre)

Abstract

This paper extends a highly influential contribution by Helpman et al. (Am Econ Rev 94: 300–316, 2004), on the link between within-industry heterogeneity, exports and foreign direct investment (FDI), by examining the robustness of their results using a more comprehensive dataset and relaxing the assumptions regarding the distribution of firm sales. The results of an ordered probit model—estimated on exports and mergers and acquisitions data for a sample of 25 origin countries, 91 destination countries and 57 manufacturing industries, over the period 1994–2004—confirm that sectors characterized by larger firms and more dispersed firm sales show higher probability of internationalization, through both exports and FDI.

Suggested Citation

  • Filomena Pietrovito & Alberto Franco Pozzolo & Luca Salvatici, 2016. "Internationalization choices: an ordered probit analysis at industry level," Empirical Economics, Springer, vol. 50(2), pages 561-594, March.
    • Handle: RePEc:spr:empeco:v:50:y:2016:i:2:d:10.1007_s00181-015-0945-8
    DOI: 10.1007/s00181-015-0945-8
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    More about this item

    Keywords

    Internationalization choices; Exports; Mergers and acquisitions; Ordered probit;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F20 - International Economics - - International Factor Movements and International Business - - - General
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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