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Firm export participation: entry, spillovers and tradability

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  • Martina Lawless

Abstract

This article analyses the choices made by individual firms to enter the export market. A probit specification tests the probability of exporting in the current period given past exporting experience, controlling for the firm's initial export status. This article uses a two-step estimation procedure suggested by Orme (1997, 2001), which controls for the influence of initial conditions. Significant evidence of sunk costs was found, based on the observed persistence of export activity and the explanatory power of previous exporting experience on current export status. A measure of sector tradability was also used and as expected firms in more easily traded sectors were most likely to be exporters. However, little evidence of spillovers was found in determining export market participation.

Suggested Citation

  • Martina Lawless, 2009. "Firm export participation: entry, spillovers and tradability," Applied Economics, Taylor & Francis Journals, vol. 41(5), pages 665-675.
    • Handle: RePEc:taf:applec:v:41:y:2009:i:5:p:665-675
    DOI: 10.1080/00036840601007401
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    References listed on IDEAS

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    1. Andrew B Bernard & J Bradford Jensen, 2001. "Exporting and Productivity: The Importance of Reallocation," Working Papers 01-02, Center for Economic Studies, U.S. Census Bureau.
    2. Arulampalam, Wiji & Booth, Alison L & Taylor, Mark P, 2000. "Unemployment Persistence," Oxford Economic Papers, Oxford University Press, vol. 52(1), pages 24-50, January.
    3. Arulampalam, Wiji, 2002. "State Dependence in Unemployment Incidence: Evidence for British Men Revisited," IZA Discussion Papers 630, Institute of Labor Economics (IZA).
    4. Peter L. Swan & John Zeitsch, 1992. "The Emerging Australian Manufacturing Export Response to Microeconomic Reform," Australian Journal of Management, Australian School of Business, vol. 17(1), pages 21-58, June.
    5. Andrew Henley, 2004. "Self-Employment Status: The Role of State Dependence and Initial Circumstances," Small Business Economics, Springer, vol. 22(1), pages 67-82, February.
    6. 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 545-564, September.
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    Cited by:

    1. Bisztray, Márta & Koren, Miklós & Szeidl, Adam, 2018. "Learning to import from your peers," Journal of International Economics, Elsevier, vol. 115(C), pages 242-258.
    2. Péter Harasztosi, 2016. "Export spillovers in Hungary," Empirical Economics, Springer, vol. 50(3), pages 801-830, May.
    3. Ziliang Deng & Adam Blake & Rod Falvey, 2009. "Quantifying Foreign Direct Investment Productivity Spillovers: A Computable General Equilibrium Framework for China," Discussion Papers 09/18, University of Nottingham, GEP.

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    More about this item

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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