Foreign Ownership and the Export and Import Propensities of Developing‐Country Firms

21 Pages Posted: 7 Dec 2017

See all articles by Dominik Boddin

Dominik Boddin

Deutsche Bundesbank - Deutsche Bundesbank Research Data and Service Centre

Horst Raff

Christian-Albrechts-Universitaet zu Kiel; CESifo (Center for Economic Studies and Ifo Institute); Kiel Institute for the World Economy

Natalia Trofimenko

Kiel Institute for World Economics

Date Written: December 2017

Abstract

This paper uses micro‐data from the World Bank Enterprise Surveys 2002–06 to investigate how foreign ownership affects the likelihood of manufacturers in developing countries to export and/or import either directly or indirectly. Applying propensity score matching to control for differences across firms in terms of labour productivity and other characteristics, we find that foreign ownership raises the propensity of a firm to export by over 17 and the propensity to import by more than 13 percentage points. The effects are even bigger for countries with the lowest per capita income and institutional quality.

Keywords: development, foreign direct investment, foreign ownership, intermediation, international trade, multinational enterprise

Suggested Citation

Boddin, Dominik and Raff, Horst and Trofimenko, Natalia, Foreign Ownership and the Export and Import Propensities of Developing‐Country Firms (December 2017). The World Economy, Vol. 40, Issue 12, pp. 2543-2563, 2017, Available at SSRN: https://ssrn.com/abstract=3083245 or http://dx.doi.org/10.1111/twec.12547

Dominik Boddin (Contact Author)

Deutsche Bundesbank - Deutsche Bundesbank Research Data and Service Centre ( email )

Wilhelm-Epstein-Straße 14
Frankfurt am Main, 60431
Germany

Horst Raff

Christian-Albrechts-Universitaet zu Kiel ( email )

Institut fur Volkswirtschaftslehre
Wilhelm-Seelig-Platz 1
Kiel, 24098
Germany
+49-431-880-1582 (Phone)
+49-431-880-3150 (Fax)

HOME PAGE: http://www.wiso.uni-kiel.de/vwlinstitute/Raff/?page=raff

CESifo (Center for Economic Studies and Ifo Institute)

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Munich, DE-81679
Germany

Kiel Institute for the World Economy ( email )

P.O. Box 4309
Kiel, Schleswig-Hosltein D-24100
Germany

Natalia Trofimenko

Kiel Institute for World Economics ( email )

P.O. Box 4309
Kiel, Schleswig-Hosltein D-24100
Germany

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