The Export-Productivity Link in Brazilian Manufacturing Firms

35 Pages Posted: 20 Apr 2016

See all articles by X. Cirera

X. Cirera

Institute of Development Studies; World Bank

Daniel Lederman

World Bank - Latin America and Caribbean Region

J. A. Máñez

University of Valencia - Faculty of Economics

M. E. Rochina

University of Valencia - Department of Economic Analysis; University College London

J. A. Sanchis

University of Valencia - Department of Applied Economics II

Date Written: July 13, 2015

Abstract

This paper explores the link between exports and total factor productivity in Brazilian manufacturing firms over the period 2000?08. The Brazilian experience is instructive, as it is a case of an economy that expanded aggregate exports significantly, but with stagnant aggregate growth in total factor productivity. The paper first estimates firm-level total factor productivity under alternative assumptions (exogenous and endogenous law of motion for productivity) following a GMM procedure. In turn, the analysis uses stochastic dominance techniques to assess whether the ex ante most productive firms are those that start exporting (self-selection hypothesis). Finally, the paper tests whether exporting boosts firms? total factor productivity growth (learning-by-exporting hypothesis) using matching techniques to control for the possibility that selection into exports may not be a random process. The results confirm the self-selection hypothesis and show that starting to export yields additional growth in total factor productivity that emerges since the firm?s first year of exporting but lasts only one year. Further, this extra total factor productivity growth is much higher under the assumption of an endogenous law of motion for productivity, which reinforces the importance of accounting for firm export status to study the evolution of productivity.

Keywords: Private Sector Economics, Economic Growth, Marketing, Economic Theory & Research, Industrial Economics, Private Sector Development Law, International Trade and Trade Rules

Suggested Citation

Cirera, Xavier and Lederman, Daniel and Máñez-Castillejo, Juan A. and Rochina-Barrachina, María Engracia and Sanchis-Llopis, Juan Alberto, The Export-Productivity Link in Brazilian Manufacturing Firms (July 13, 2015). World Bank Policy Research Working Paper No. 7365. Available at SSRN: https://ssrn.com/abstract=2630381

Xavier Cirera (Contact Author)

Institute of Development Studies ( email )

University of Sussex
Falmer, Brighton, East Sussex BN1 9RE
United Kingdom

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Daniel Lederman

World Bank - Latin America and Caribbean Region ( email )

1818 H Street NW
Washington, DC 20433
United States

HOME PAGE: http://sites.google.com/site/danielledermanworldbank/

Juan A. Máñez-Castillejo

University of Valencia - Faculty of Economics ( email )

Valencia, E-46022
Spain

María Engracia Rochina-Barrachina

University of Valencia - Department of Economic Analysis ( email )

Campus de los Naranjos
46022 Valencia
Spain

University College London

Gower Street
London
United Kingdom

Juan Alberto Sanchis-Llopis

University of Valencia - Department of Applied Economics II ( email )

Edifici Departamental Oriental
Avda. dels Tarongers, S/N
46022 Valencia
Spain

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