The Causal Effect of Exporting and Multinational Acquisition on TFP in UK: An Evaluation Method Approach
GEP Research Paper 2008/16
33 Pages Posted: 17 Oct 2008 Last revised: 30 Nov 2008
Date Written: April 1, 2008
Abstract
This paper assesses the effect on total factor productivity (TFP) of a change in the status of a firm from domestic producer to either exporter or subsidiary of a multinational firm. It is an extension of earlier work that looks solely on the effect of exporting on TFP (Girma et al, 2003 and 2004 and Wagner, 2002). In particular, it estimates the differences in TFP between domestic, exporting firms or subsidiaries of multinationals after controlling for the likely presence of endogeneity using the Multiple Treatment Approach (Blundell and Costa Dias, 2000 and Lechner, 2001). Results show that firms that have become exporters experience higher TFP, between 7.8% and 8.8%, with respect to domestic producers. Productivity gains were also experienced for firms acquired by multinationals relative to domestic producers ranging from 11.5% to 13%. Finally, exporters have a lower annual TFP compared to firms acquired by multinationals by around 10 percentage points.
Keywords: Exporting, aquisition, TFP, multinationals, propensity score matching, multiple treatments
JEL Classification: F14, F23
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Wages and Foreign Ownership: A Comparative Study of Mexico, Venezuela and the United States
By Brian Aitken, Ann E. Harrison, ...
-
Does Inward Foreign Direct Investment Boost the Productivity of Domestic Firms?
By Jonathan Haskel, Sonia C. Pereira, ...
-
Does Inward Foreign Direct Investment Boost the Productivity of Domestic Firms?
By Jonathan Haskel, Sonia C. Pereira, ...
-
Does Inward Foreign Direct Investment Boost the Productivity of Domestic Firms?
By Jonathan Haskel, Sonia C. Pereira, ...
-
Much Ado About Nothing? Do Domestic Firms Really Benefit from Foreign Direct Investment?
By Holger Görg and David Greenaway
-
Much Ado About Nothing? Do Domestic Firms Really Benefit from Foreign Investment?
By Holger Görg and David Greenaway
-
Foreign Direct Investment as a Catalyst for Industrial Development
-
Foreign Investment and Productivity Growth in Czech Enterprises
By Bernard Hoekman and Simeon Djankov
-
Technology Transfer and Spillovers? Does Local Participation with Multinationals Matter?
By Magnus Blomstrom and Fredrik Sjoholm