IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

Productivity and the Decision to Export: Micro Evidence from Taiwan and South Korea

  • Bee Yan Aw
  • Sukkyun Chung
  • Mark J. Roberts

While there is widespread empirical evidence indicating exporting producers have higher productivity than nonexporters, the mechanisms that generate this pattern are less clear. One view is that exporters acquire knowledge of new production methods, inputs, and product designs from their international contacts, and this learning results in higher productivity for exporters relative to their more insulated domestic counterparts. Alternatively, the higher productivity of exporters may simply reflect the self-selection of more efficient producers into a highly competitive export market. In this paper we use micro data collected in the manufacturing censuses in South Korea and Taiwan to study the linkages between a producer's total factor productivity and choice to participate in the export market. We find differences between the countries in the importance of selection and learning forces. In Taiwan, transitions of firms in and out of the export market reflect systematic variations in productivity as predicted by self-selection models. Firms with higher productivity, ex ante, tend to enter the export market and exporters with low productivity tend to exit. Moreover, in several industries, entry into the export market is followed by relative productivity improvements, a result consistent with learning-by-exporting forces. In South Korea, the evidence of self-selection on the basis of productivity is much weaker. In addition, unlike Taiwan, we find no significant productivity changes following entry or exit from the export market that are consistent with learning from exporting. Comparison of the two countries suggests that in Korea factors other than production efficiency play a more prominent role as determinants determinants of the export decision.

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://www.nber.org/papers/w6558.pdf
Download Restriction: no

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 6558.

as
in new window

Length:
Date of creation: May 1998
Date of revision:
Publication status: published as World Bank Economic Review, Vol. 14, no. 1 (January 2000): 65-90.
Handle: RePEc:nbr:nberwo:6558
Note: ITI
Contact details of provider: Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
Phone: 617-868-3900
Web page: http://www.nber.org
Email:


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. Handoussa, Heba & Nishimizu, Mieko & Page, John Jr., 1986. "Productivity change in Egyptian public sector industries after the opening, 1973-1979," Journal of Development Economics, Elsevier, vol. 20(1), pages 53-73.
  2. Andrew B. Bernard & J. Bradford Jensen, 1994. "Exporters, Jobs and Wages in U.S. Manufacturing: 1976-1987," Working papers 95-7, Massachusetts Institute of Technology (MIT), Department of Economics.
  3. Sofronis Clerides & Saul Lach & James Tybout, 1996. "Is "Learning-by-Exporting" Important? Micro-Dynamic Evidence from Colombia, Mexico and Morocco," NBER Working Papers 5715, National Bureau of Economic Research, Inc.
  4. Jovanovic, Boyan, 1982. "Selection and the Evolution of Industry," Econometrica, Econometric Society, vol. 50(3), pages 649-70, May.
  5. Bernard, Andrew B. & Bradford Jensen, J., 1999. "Exceptional exporter performance: cause, effect, or both?," Journal of International Economics, Elsevier, vol. 47(1), pages 1-25, February.
  6. Westphal, Larry E, 1990. "Industrial Policy in an Export-Propelled Economy: Lessons from South Korea's Experience," Journal of Economic Perspectives, American Economic Association, vol. 4(3), pages 41-59, Summer.
  7. Roberts, Mark J & Tybout, James R, 1997. "The Decision to Export in Colombia: An Empirical Model of Entry with Sunk Costs," American Economic Review, American Economic Association, vol. 87(4), pages 545-64, September.
  8. repec:dgr:uvatin:19990068 is not listed on IDEAS
  9. Hopenhayn, Hugo A, 1992. "Entry, Exit, and Firm Dynamics in Long Run Equilibrium," Econometrica, Econometric Society, vol. 60(5), pages 1127-50, September.
  10. Aw, B. -Y. & Hwang, A. R., 1995. "Productivity and the export market: A firm-level analysis," Journal of Development Economics, Elsevier, vol. 47(2), pages 313-332, August.
  11. Bee Yan Aw & Geeta Batra, 1998. "Technology, Exports And Firm Efficiency In Taiwanese Manufacturing," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 7(2), pages 93-113.
  12. Pack, Howard & Westphal, Larry E., 1986. "Industrial strategy and technological change : Theory versus reality," Journal of Development Economics, Elsevier, vol. 22(1), pages 87-128, June.
  13. Campa, Jose M., 2000. "Exchange rates and trade: How important is hysteresis in trade?," IESE Research Papers D/427, IESE Business School.
  14. Lambson, V.E., 1989. "Industry Evolution With Sunk Costs And Uncertian Market Conditions," Working papers 8904, Wisconsin Madison - Social Systems.
  15. Tybout, James R. & Westbrook, M. Daniel, 1995. "Trade liberalization and the dimensions of efficiency change in Mexican manufacturing industries," Journal of International Economics, Elsevier, vol. 39(1-2), pages 53-78, August.
  16. Evenson, Robert E. & Westphal, Larry E., 1995. "Technological change and technology strategy," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 37, pages 2209-2299 Elsevier.
  17. David H. Good & M. Ishaq Nadiri & Robin C. Sickles, 1996. "Index Number and Factor Demand Approaches to the Estimation of Productivity," NBER Working Papers 5790, National Bureau of Economic Research, Inc.
  18. Levy, B., 1988. "Korean And Taiwanese Firms As International Competitors: The Challenges Ahead," Center for Development Economics 110, Department of Economics, Williams College.
  19. Dani Rodrik, 1994. "Getting Interventions Right: How South Korea and Taiwan Grew Rich," NBER Working Papers 4964, National Bureau of Economic Research, Inc.
  20. Levy, Brian, 1990. "Transactions costs, the size of firms and industrial policy : Lessons from a comparative case study of the footwear industry in Korea and Taiwan," Journal of Development Economics, Elsevier, vol. 34(1-2), pages 151-178, November.
  21. Haddad, Mona, 1993. "How trade liberalization affected productivity in Morocco," Policy Research Working Paper Series 1096, The World Bank.
  22. Chen, Tain-jy & Tang, De-piao, 1987. "Comparing technical efficiency between import-substitution-oriented and export-oriented foreign firms in a developing economy," Journal of Development Economics, Elsevier, vol. 26(2), pages 277-289, August.
  23. Aw, B.Y. & Batra, G., 1998. "Technology, Exports and Firm Efficiency in Taiwanese Manufacturing," Papers 2, Pennsylvania State - Department 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:nbr:nberwo:6558. 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: ()

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.