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Export experience of managers and the internationalization of firms

Author

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  • Sala, Davide

    () (Department of Business and Economics)

  • Yalcin, Erdal

    () (IFO Institute - Leibniz Institute for Economic Research)

Abstract

As the firm gravitates to the core analysis of international trade models, the possibilities to learn from the theory of the multinational enterprise developed in international business studies increase. The managerial resources and capabilities that are so emphasized in this theory for export initiation have largely been neglected in the empirical studies of international trade. Probably not because they are unimportant, but rather because of the challenge to identify and measure them. We exploit Danish employer-employee matched data to overcome this barrier and analyze the impact of managers’ international experience together with other managerial characteristics on the likelihood that the firm starts exporting. We find that productivity and fixed costs associated to exporting are not the sole determinants of the selection of firms into international markets, but “managerial inputs” are as important. Our data allows us to identify managers’ export experience based on the CEOs’ historical career as documented in official registry statistics. This puts our study apart from earlier survey based studies which rely on self-assessments.

Suggested Citation

  • Sala, Davide & Yalcin, Erdal, 2012. "Export experience of managers and the internationalization of firms," Discussion Papers of Business and Economics 18/2012, University of Southern Denmark, Department of Business and Economics.
  • Handle: RePEc:hhs:sdueko:2012_018
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    References listed on IDEAS

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    1. Davide Sala & Philipp J. H. Schröder & Erdal Yalcin, 2010. "Market Access Through Bound Tariffs," Scottish Journal of Political Economy, Scottish Economic Society, vol. 57(s1), pages 272-289, July.
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    3. Sebastian Krautheim, 2007. "Gravity and Information: Heterogeneous Firms, Exporter Networks and the 'Distance Puzzle'," Economics Working Papers ECO2007/51, European University Institute.
    4. Giordano Mion & Luca David Opromolla, 2011. "Managers’ Mobility, Trade Status, and Wages," Working Papers w201104, Banco de Portugal, Economics and Research Department.
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    8. Li, Jing & Rugman, Alan M., 2007. "Real options and the theory of foreign direct investment," International Business Review, Elsevier, vol. 16(6), pages 687-712, December.
    9. Bell, Linda & Smith, Nina & Smith, Valdemar & Verner, Mette, 2008. "Gender differences in promotion into top-management jobs," Working Papers 08-21, University of Aarhus, Aarhus School of Business, Department of Economics.
    10. Mike W Peng & Anne S York, 2001. "Behind Intermediary Performance in Export Trade: Transactions, Agents, and Resources," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 32(2), pages 327-346, June.
    11. Gary Chamberlain, 1980. "Analysis of Covariance with Qualitative Data," Review of Economic Studies, Oxford University Press, vol. 47(1), pages 225-238.
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    Citations

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    Cited by:

    1. Jaan Masso & Priit Vahter, 2016. "Knowledge Transfer From Multinationals Through Labour Mobility: Learning From Export Experience," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 99, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    2. Jaan Masso & Kärt Rõigas & Priit Vahter, 2015. "Foreign market experience, learning by hiring and firm export performance," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 151(4), pages 659-686, November.
    3. Parrotta, Pierpaolo & Pozzoli, Dario & Sala, Davide, 2016. "Ethnic diversity and firms' export behavior," European Economic Review, Elsevier, vol. 89(C), pages 248-263.
    4. Junghyun Yoon & Dae-su Kim, 2016. "Empirical Relationships among Technological Characteristics, Global Orientation, and Internationalisation of South Korean New Ventures," Sustainability, MDPI, Open Access Journal, vol. 8(12), pages 1-13, December.
    5. Hatzigeorgiou, Andreas & Lodefalk, Magnus, 2015. "The Role of Foreign Networks for Firm Export of Services," Working Papers 2015:6, Örebro University, School of Business.
    6. Jaan Masso, 2014. "Foreign Market Experience, Learning by Hiring and Firm Export," Discussion Papers 26, Central European Labour Studies Institute (CELSI).
    7. Hatzigeorgiou, Andreas & Lodefalk, Magnus, 2017. "Migration and Servicification: Do Immigrant Employees Spur Firm Exports of Services?," Ratio Working Papers 298, The Ratio Institute.
    8. Magnus Lodefalk, 2016. "Temporary expats for exports: micro-level evidence," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 152(4), pages 733-772, November.
    9. Danielken Molina & Marc-Andreas Muendler, 2013. "Preparing to Export," NBER Working Papers 18962, National Bureau of Economic Research, Inc.

    More about this item

    Keywords

    Export status; managerial promotions; international experience; self-selection;

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • M51 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Personnel Economics - - - Firm Employment Decisions; Promotions

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