Exporting and Performance of Plants: Evidence from Korean Manufacturing

42 Pages Posted: 15 Jan 2004 Last revised: 24 May 2021

See all articles by Chinhee Hahn

Chinhee Hahn

Korea Development Institute (KDI) - Macroeconomic Policy Division

Date Written: January 2004

Abstract

This study examines the relationship between exporting and various performance measures including total factor productivity, using the annual plant-level panel data on Korean manufacturing sector during the period of 1990 to 1998. The two key questions examined are whether exporting improves productivity (learning) and/or whether more productive plants export (self-selection). This study provides evidence supporting both self-selection and learning-by-exporting effects, with both effects being more pronounced at around the time of entry into and exit from the export market. Thus, positive and robust cross-sectional correlation between exporting and total factor productivity is accounted for by both selection and learning effects. These results are in contrast with Aw, Chung, and Roberts (2000) who do not find any strong evidence of self-selection or learning in Korea. Similar effects are observed when shipments or employment is considered as a performance measure. Overall, this study suggests that the benefits from exporting have been realized not only through resource reallocation channel but also TFP channel in Korea.

Suggested Citation

Hahn, Chinhee, Exporting and Performance of Plants: Evidence from Korean Manufacturing (January 2004). NBER Working Paper No. w10208, Available at SSRN: https://ssrn.com/abstract=486212

Chinhee Hahn (Contact Author)

Korea Development Institute (KDI) - Macroeconomic Policy Division ( email )

P.O. Box 113 Cheongryangri Dong
Seoul 130-012
United States

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