Heterogeneity and the Structure of Exports and FDI: A cross-industry analysis of Japanese manufacturing
The fraction of exporters and multinational enterprises (MNEs) varies substantially across industries. We extend the firm heterogeneity model presented by Helpman et al. (2004) to derive testable predictions about the prevalence of these internationalized modes. The model indicates that intra-industry firm heterogeneity and R&D intensity play large roles in inter-industry variation of the fraction of internationalized firms. We investigate whether these factors as well as import tariffs affect the structure of exports and foreign direct investment (FDI) using Japanese industry-level data. We obtain results that are consistent with the model. First, industries with larger productivity dispersion have a larger fraction of MNEs and a larger fraction of the sum of exporters and MNEs. Second, MNEs are heavily concentrated in R&D-intensive industries. In addition, we reveal that industries with lower import tariffs have a larger fraction of exporters and MNEs.
|Date of creation:||Jan 2011|
|Contact details of provider:|| Postal: 11th floor, Annex, Ministry of Economy, Trade and Industry (METI) 1-3-1, Kasumigaseki Chiyoda-ku, Tokyo, 100-8901|
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- Massimo Del Gatto & Gianmarco I. P. Ottaviano & Marcello Pagnini, 2008.
"Openness To Trade And Industry Cost Dispersion: Evidence From A Panel Of Italian Firms,"
Journal of Regional Science,
Wiley Blackwell, vol. 48(1), pages 97-129.
- Massimo Del Gatto & Gianmarco I.P. Ottaviano & Marcello Pagnini, 2007. "Openess to trade and industry cost dispersion: Evidence from a panel of Italian firms," Temi di discussione (Economic working papers) 635, Bank of Italy, Economic Research and International Relations Area.
- Del Gatto, Massimo & Ottaviano, Gianmarco & Pagnini, Marcello, 2007. "Openness to Trade and Industry Cost Dispersion: Evidence from a Panel of Italian Firms," CEPR Discussion Papers 6336, C.E.P.R. Discussion Papers.
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- Tomiura, Eiichi, 2007. "Foreign outsourcing, exporting, and FDI: A productivity comparison at the firm level," Journal of International Economics, Elsevier, vol. 72(1), pages 113-127, May.
- Eiichi Tomiura, 2005. "Foreign Outsourcing, Exporting, and FDI: A Productivity Comparison at the Firm Level," Discussion Paper Series 168, Research Institute for Economics & Business Administration, Kobe University.
- Alessandro Nicita & Marcelo Olarreaga, 2007. "Trade, Production, and Protection Database, 1976--2004," World Bank Economic Review, World Bank Group, vol. 21(1), pages 165-171.
- WAKASUGI Ryuhei & TODO Yasuyuki & SATO Hitoshi & NISHIOKA Shuichiro & MATSUURA Toshiyuki & ITO Banri & TANAKA Ayumu, 2008. "The Internationalization of Japanese Firms: New Findings Based on Firm-Level Data," Discussion papers 08036, Research Institute of Economy, Trade and Industry (RIETI).
- Ederington, Josh & McCalman, Phillip, 2008. "Endogenous firm heterogeneity and the dynamics of trade liberalization," Journal of International Economics, Elsevier, vol. 74(2), pages 422-440, March. Full references (including those not matched with items on IDEAS)
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