Pre-Export R&D, Exporting and Productivity Gains: Evidence from Chinese Firms

29 Pages Posted: 6 Jan 2011

See all articles by Miaojie Yu

Miaojie Yu

Peking University - China Center for Economic Research (CCER)

Mi Dai

Beijing Normal University (BNU)

Date Written: January 4, 2011

Abstract

Does entry into the export market enhance firms’ productivity? In this paper, we estimate the instantaneous and long-run effects of exporting on the productivity of Chinese manufacturing firms during 2001 and 2007. We argue that pre-export R&D plays a crucial role in generating post-entry productivity gains by increasing firms’ absorptive capacity. Adopting propensity score matching in our estimation, we find that: (1) On average, starting to export has an instantaneous effect in raising productivity by 2%, but there are no significant long-run effects. (2) Firms that have ever invested in R&D before exporting experience large and lasting productivity gains, while for firms without pre-export R&D the gains do not exist even instantaneously. (3) The productivity gains exporting are increasing in the number of years a firm invests in pre-export R&D.

Keywords: Export, TFP, Pre-export R&D

JEL Classification: F1, L1, D24

Suggested Citation

Yu, Miaojie and Dai, Mi, Pre-Export R&D, Exporting and Productivity Gains: Evidence from Chinese Firms (January 4, 2011). Available at SSRN: https://ssrn.com/abstract=1734721 or http://dx.doi.org/10.2139/ssrn.1734721

Miaojie Yu (Contact Author)

Peking University - China Center for Economic Research (CCER) ( email )

Beijing, Beijing 100871
China
+86-10-6275-3109 (Phone)

HOME PAGE: http://mjyu.ccer.edu.cn

Mi Dai

Beijing Normal University (BNU) ( email )

19 Xinjiekou Outer St
Haidian District
Beijing, Guangdong 100875
China

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