IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Internationalization choices: an ordered probit analysis at industry-level

Listed author(s):
  • Pietrovito, Filomena
  • Pozzolo, Alberto Franco
  • Salvatici, Luca

Trade theory traces back different patterns of internationalization to heterogeneity between firms, measured both through differences in productivity levels and size. In this paper we analyze the link between heterogeneity within sectors and internationalization choices, namely trade and foreign direct investments (FDI) for a large sample of countries and industries between 1994 and 2004. The focus of our paper is on the role played by average productivity level and the distribution of firms by size in explaining differences across sectors and countries in the extensive margin of internationalization (i.e., the number of foreign nations where firms from a given sector and country have expanded abroad). By performing an ordered probit analysis, and controlling for other factors affecting the patterns of internationalization, we confirm that industries with higher productivity levels and with a distribution of firms shifted toward large firms are more prone to internationalize in foreign markets through both trade and FDI. Moreover, the relative impact of average productivity and firm size on FDI is larger than that on trade. These results are robust to different measures of productivity and the distribution of firms.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://web.unimol.it/progetti/repec/mol/ecsdps/ESDP13071.pdf
Download Restriction: no

Paper provided by University of Molise, Dept. EGSeI in its series Economics & Statistics Discussion Papers with number esdp13071.

as
in new window

Length:
Date of creation: 25 Jan 2013
Handle: RePEc:mol:ecsdps:esdp13071
Contact details of provider: Postal:
Via De Sanctis, 86100 Campobasso

Fax: +39-0874311124
Web page: http://www.unimol.it

More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as
in new window


  1. Thomas Chaney, 2014. "The Network Structure of International Trade," American Economic Review, American Economic Association, vol. 104(11), pages 3600-3634, November.
  2. Gabriel J Felbermayr & Wilhelm Kohler, 2014. "Exploring the Intensive and Extensive Margins of World Trade," World Scientific Book Chapters,in: European Economic Integration, WTO Membership, Immigration and Offshoring, chapter 4, pages 115-148 World Scientific Publishing Co. Pte. Ltd..
  3. David L. Carr & James R. Markusen & Keith E. Maskus, 2001. "Estimating the Knowledge-Capital Model of the Multinational Enterprise," American Economic Review, American Economic Association, vol. 91(3), pages 693-708, June.
  4. Arjen H L Slangen & Sjoerd Beugelsdijk, 2010. "The impact of institutional hazards on foreign multinational activity: A contingency perspective," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 41(6), pages 980-995, August.
  5. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2007. "Firms in International Trade," Journal of Economic Perspectives, American Economic Association, vol. 21(3), pages 105-130, Summer.
  6. Nils Herger & Christos Kotsogiannis & Steve McCorriston, 2008. "Cross-border acquisitions in the global food sector," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 35(4), pages 563-587, December.
  7. Anders Isaksson, 2009. "The UNIDO World Productivity Database: An Overview," International Productivity Monitor, Centre for the Study of Living Standards, vol. 18, pages 38-50, Spring.
  8. Sosa Andrés, Maximiliano & Nunnenkamp, Peter & Busse, Matthias, 2013. "What drives FDI from non-traditional sources? A comparative analysis of the determinants of bilateral FDI flows," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 7, pages 1-53.
  9. Pedro Martins & Yong Yang, 2009. "The impact of exporting on firm productivity: a meta-analysis of the learning-by-exporting hypothesis," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 145(3), pages 431-445, October.
  10. Rajan, Raghuram G & Zingales, Luigi, 1998. "Financial Dependence and Growth," American Economic Review, American Economic Association, vol. 88(3), pages 559-586, June.
  11. Jeffrey M Wooldridge, 2010. "Econometric Analysis of Cross Section and Panel Data," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262232588, July.
  12. Elhanan Helpman & Marc J. Melitz & Stephen R. Yeaple, 2004. "Export Versus FDI with Heterogeneous Firms," American Economic Review, American Economic Association, vol. 94(1), pages 300-316, March.
  13. Keith Head & Thierry Mayer & Mathias Thoenig, 2014. "Welfare and Trade without Pareto," American Economic Review, American Economic Association, vol. 104(5), pages 310-316, May.
  14. Markusen, James R & Maskus, Keith E, 2002. "Discriminating among Alternative Theories of the Multinational Enterprise," Review of International Economics, Wiley Blackwell, vol. 10(4), pages 694-707, November.
  15. Luigi Benfratello & Tiziano Razzolini, 2008. "Firms’ Productivity and Internationalisation Choices: Evidence for a Large Sample of Italian Firms," Development Working Papers 236, Centro Studi Luca d'Agliano, University of Milano.
  16. S. Lael Brainard, 1993. "A Simple Theory of Multinational Corporations and Trade with a Trade-Off Between Proximity and Concentration," NBER Working Papers 4269, National Bureau of Economic Research, Inc.
  17. Bruce Blonigen, 2005. "A Review of the Empirical Literature on FDI Determinants," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 33(4), pages 383-403, December.
  18. Roberto Basile & Anna Giunta & Jeffrey Nugent, 2003. "Foreign Expansion by Italian Manufacturing Firms in the Nineties: an Ordered Probit Analysis," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 23(1), pages 1-24, August.
  19. Anne-Célia Disdier & Keith Head, 2008. "The Puzzling Persistence of the Distance Effect on Bilateral Trade," The Review of Economics and Statistics, MIT Press, vol. 90(1), pages 37-48, February.
  20. Head, Keith & Ries, John, 2003. "Heterogeneity and the FDI versus export decision of Japanese manufacturers," Journal of the Japanese and International Economies, Elsevier, vol. 17(4), pages 448-467, December.
  21. Spiros Bougheas & Holger Görg, "undated". "Organizational Forms for Global Engagement of Firms," Discussion Papers 08/33, University of Nottingham, GEP.
  22. Fukunari Kimura & Kozo Kiyota, 2006. "Exports, FDI, and Productivity: Dynamic Evidence from Japanese Firms," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 142(4), pages 695-719, December.
  23. Elhanan Helpman & Marc Melitz & Yona Rubinstein, 2008. "Estimating Trade Flows: Trading Partners and Trading Volumes," The Quarterly Journal of Economics, Oxford University Press, vol. 123(2), pages 441-487.
  24. Brainard, S Lael, 1997. "An Empirical Assessment of the Proximity-Concentration Trade-off between Multinational Sales and Trade," American Economic Review, American Economic Association, vol. 87(4), pages 520-544, September.
  25. Harald Oberhofer & Michael Pfaffermayr, 2012. "FDI versus Exports: Multiple Host Countries and Empirical Evidence," The World Economy, Wiley Blackwell, vol. 35(3), pages 316-330, 03.
  26. Nunnenkamp, Peter, 2002. "Determinants of FDI in developing countries: has globalization changed the rules of the game?," Kiel Working Papers 1122, Kiel Institute for the World Economy (IfW).
  27. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
  28. Andrew B. Bernard & J. Bradford Jensen, 2004. "Why Some Firms Export," The Review of Economics and Statistics, MIT Press, vol. 86(2), pages 561-569, May.
  29. Blonigen, Bruce A., 2002. "Tariff-jumping antidumping duties," Journal of International Economics, Elsevier, vol. 57(1), pages 31-49, June.
  30. Ben S. Bernanke & Kenneth Rogoff, 2002. "NBER Macroeconomics Annual 2001, Volume 16," NBER Books, National Bureau of Economic Research, Inc, number bern02-1.
  31. Ben S. Bernanke & Refet S. Gürkaynak, 2002. "Is Growth Exogenous? Taking Mankiw, Romer, and Weil Seriously," NBER Chapters,in: NBER Macroeconomics Annual 2001, Volume 16, pages 11-72 National Bureau of Economic Research, Inc.
  32. David Greenaway & Richard Kneller, 2007. "Firm heterogeneity, exporting and foreign direct investment," Economic Journal, Royal Economic Society, vol. 117(517), pages 134-161, 02.
  33. Yasuyuki Todo, 2011. "Quantitative Evaluation of the Determinants of Export and FDI: Firm‐level Evidence from Japan," The World Economy, Wiley Blackwell, vol. 34(3), pages 355-381, 03.
  34. Stephen Ross Yeaple, 2003. "The Role of Skill Endowments in the Structure of U.S. Outward Foreign Direct Investment," The Review of Economics and Statistics, MIT Press, vol. 85(3), pages 726-734, August.
  35. repec:lmu:muenar:20646 is not listed on IDEAS
  36. Chengang Wang & Yingqi Wei & Xiaming Liu, 2010. "Determinants of Bilateral Trade Flows in OECD Countries: Evidence from Gravity Panel Data Models," The World Economy, Wiley Blackwell, vol. 33(7), pages 894-915, 07.
  37. Daniel K. N. Johnson, 2002. "The OECD Technology Concordance (OTC): Patents by Industry of Manufacture and Sector of Use," OECD Science, Technology and Industry Working Papers 2002/5, OECD Publishing.
  38. Bogheas, Sprios & Görg, Holger, 2008. "Organizational forms for global engagement of firms," Kiel Working Papers 1448, Kiel Institute for the World Economy (IfW).
  39. Alexander Vogel & Joachim Wagner, 2011. "Robust estimates of exporter productivity premia in German business services enterprises," Working Paper Series in Economics 207, University of Lüneburg, Institute of Economics.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:mol:ecsdps:esdp13071. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Claudio Lupi)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.