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The Role of Entry Costs and He terogeneous Characteristics of Firms in the Decision to Export: Empirical Evidence from Firm-level Data in Vietnam

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  • Nguyen HIEP
  • Hiroshi OHTA

Abstract

This paper contributes to the examination of factors that affect the decision to export of firms. Using a panel of firm-level data in Vietnam's manufacturing sector, we test for the role of sunk costs and heterogeneous characteristics of firms in determining firms' probability of exporting. Under a framework that controls for unobserved heterogeneity among firms, we find that the sunk entry costs are important factor that makes export status highly persistent in Vietnam. Firm size, firm age and foreign ownership are positively related to export probability of firms, while total factor productivity has no statistically significant effect. Besides, firms with labor-intensive technology, more skilled labors or competitive labor service are more likely to export.

Suggested Citation

  • Nguyen HIEP & Hiroshi OHTA, 2007. "The Role of Entry Costs and He terogeneous Characteristics of Firms in the Decision to Export: Empirical Evidence from Firm-level Data in Vietnam," GSICS Working Paper Series 17, Graduate School of International Cooperation Studies, Kobe University.
    • Handle: RePEc:kcs:wpaper:17
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    File URL: http://www.research.kobe-u.ac.jp/gsics-publication/gwps/2007-17.pdf
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    References listed on IDEAS

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    Cited by:

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    2. Vu, Mai T.P. & Bellone, Flora & Dovis, Marion, 2018. "Productivity and wage premiums: Evidence from Vietnamese ordinary and processing exporters," International Economics, Elsevier, vol. 154(C), pages 48-67.
    3. Belke, Ansgar & Kronen, Dominik, 2017. "Exchange rate bands of inaction and hysteresis in EU exports to the global economy: The role of uncertainty," Ruhr Economic Papers 695, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.
    4. Mai Anh NGO, 2015. "Exporting and Firm-Level Credit Constraints-Evidence from Ghana," Working Papers DP-2015-27, Economic Research Institute for ASEAN and East Asia (ERIA).

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