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Learning-by-Exporting? Firm-Level Evidence for UK Manufacturing and Services Sectors

  • Richard Harris
  • Qian Cher Li

This study empirically assesses the microeconomic exporting-productivity nexus for both the UK manufacturing and services sectors during 1996-2004, based on a weighted FAME dataset. Our results show that firms that are older, that possess intangible assets or that have higher (labour) productivity in the year prior to exporting, are significantly more likely to sell overseas. In testing the post-entry ‘learning-by-exporting’ effect, we employ three approaches to controlling for endogeneity and sample selection, viz. instrumental variables, control function and matching, and find that this effect is present in many industries but not universal, and also varies amongst different types of exporting firms. Our overall estimate for the UK economy suggests a substantial post-entry productivity effect for firms new to exporting; a negative effect for firms exiting overseas markets; and large productivity gains while exporting for those that both enter and exit.

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Paper provided by Business School - Economics, University of Glasgow in its series Working Papers with number 2007_22.

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Date of creation: Aug 2007
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Handle: RePEc:gla:glaewp:2007_22
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