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The Pattern of Foreign Market Entry of Canadian Exporters

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  • Sui, Sui
  • Yu, Zhihao

Abstract

This paper employs a unique large-scale longitudinal (1997–2005) dataset to investigate the pattern of foreign market entry by 6,079 Canadian exporters. We have found that fewer firms are choosing the United States as their initial export destination. This trend suggests that a growing number of firms are not following the traditional stage model of internationalization. Furthermore, our results suggest that government support should be targeted towards young and small Canadian-controlled firms, since they are more likely to encounter barriers and gain benefits from exporting to a wider range of foreign markets.

Suggested Citation

  • Sui, Sui & Yu, Zhihao, 2012. "The Pattern of Foreign Market Entry of Canadian Exporters," MPRA Paper 41176, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:41176
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    References listed on IDEAS

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    1. Sofronis K. Clerides & Saul Lach & James R. Tybout, 1998. "Is Learning by Exporting Important? Micro-Dynamic Evidence from Colombia, Mexico, and Morocco," The Quarterly Journal of Economics, Oxford University Press, vol. 113(3), pages 903-947.
    2. Gervais, Yvan & Bosco Sabuhoro, Jean, 2004. "Factors Determining the Success or Failure of Canadian Establishments on Foreign Markets: A Survival Analysis Approach," Analytical Studies Branch Research Paper Series 2004220e, Statistics Canada, Analytical Studies Branch.
    3. Frances Ruane & Julie Sutherland, 2005. "Ownership and Export Characteristics of Irish Manufacturing Performance," The Institute for International Integration Studies Discussion Paper Series iiisdp032, IIIS.
    4. Thierry Mayer & Gianmarco Ottaviano, 2008. "The Happy Few: The Internationalisation of European Firms," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 43(3), pages 135-148, May.
    5. Jan Johanson & Jan-Erik Vahlne, 1977. "The Internationalization Process of the Firm—A Model of Knowledge Development and Increasing Foreign Market Commitments," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 8(1), pages 23-32, March.
    6. Krugman, Paul R., 1979. "Increasing returns, monopolistic competition, and international trade," Journal of International Economics, Elsevier, vol. 9(4), pages 469-479, November.
    7. 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.
    8. Terence Fan & Phillip Phan, 2007. "International new ventures: revisiting the influences behind the ‘born-global’ firm," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 38(7), pages 1113-1131, December.
    9. Pia Arenius, 2005. "The Psychic Distance Postulate Revised: From Market Selection to Speed of Market Penetration," Journal of International Entrepreneurship, Springer, vol. 3(2), pages 115-131, June.
    10. Steven Globerman & Paul Storer, 2009. "Border Security and Canadian Exports to the United States: Evidence and Policy Implications," Canadian Public Policy, University of Toronto Press, vol. 35(2), pages 171-186, June.
    11. J. Stephen Ferris, 2009. "Quantifying Non-tariff Trading Barriers: What Difference Did the U.S. Security Precautions Following 9/11 Make to Canadian Cross Border Shopping? -revised version: Quantifying Non-Tariff Trade Barrier," Carleton Economic Papers 09-04, Carleton University, Department of Economics, revised Dec 2010.
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    Cited by:

    1. Johannes Van Biesebroeck & Emily Yu & Shenjie Chen, 2015. "The impact of trade promotion services on Canadian exporter performance," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 48(4), pages 1481-1512, November.
    2. Sandberg, Susanne & Sui, Sui & Baum, Matthias, 2019. "Effects of prior market experiences and firm-specific resources on developed economy SMEs' export exit from emerging markets: Complementary or compensatory?," Journal of Business Research, Elsevier, vol. 98(C), pages 489-502.
    3. Muhammad Saad Moeen & Muhammad Asjad Tariq & Saqib Shahzad & Shehryar Rashid, 2016. "Factors Influencing Choice of Energy Sources in Rural Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 55(4), pages 905-920.
    4. Sui Sui & Zhihao Yu, 2013. "Special Issue. Guest Editor: Zhihao Yu," Review of Development Economics, Wiley Blackwell, vol. 17(3), pages 510-522, August.
    5. Love, James H. & Roper, Stephen & Zhou, Ying, 2016. "Experience, age and exporting performance in UK SMEs," International Business Review, Elsevier, vol. 25(4), pages 806-819.
    6. Sui, Sui & Morgan, Horatio M. & Baum, Matthias, 2015. "Internationalization of immigrant-owned SMEs: The role of language," Journal of World Business, Elsevier, vol. 50(4), pages 804-814.

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    More about this item

    Keywords

    Canadian exporters; United States; emerging market; foreign market entry; internationalization process; stage model;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • O51 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - U.S.; Canada

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