Performance on Exports: Continuous Productivity Improvements or Capacity Utilization

LICOS Discussion Paper No. 163/2005

37 Pages Posted: 8 Feb 2006

See all articles by Jože P. Damijan

Jože P. Damijan

University of Ljubljana, Slovenia - Department of International Economics

Črt Kostevc

University of Ljubljana - Faculty of Economics

Date Written: 2005

Abstract

Following along the lines of a growing literature on the causal link between exporting and productivity this paper analyzes the existence of learning-by-exporting using firm-level data. The paper asks whether, in addition to better performing firms self-selecting into exports and multinational production, exporting (multinational production) further improves their performance compared with non-exporters.We develop and test a simple model of trade and international production with heterogeneous firms that generates learning effects through competition in the exportfmarkets. The estimations performed on the sample of Slovenian manufacturing enterprises between 1994 and 2002 indicate that more productive firms tend to self-selectfinto more competitive markets, while there is no conclusive evidence of learning-by-exporting. Although new exporters experienced a surge in productivity in the initial year of exports the effect dissipates as soon as the following year. Confronting the data on factor accumulation with TFP measures indicates that the perceived learning effects may in fact only be a consequence of increased capacity utilization brought forth by the opening of an additional market.

Keywords: Firm heterogeneity, exports, learning-by-exporting, difference-in-differences, matching

JEL Classification: D24, F12, F14

Suggested Citation

Damijan, Joze P. and Kostevc, Crt, Performance on Exports: Continuous Productivity Improvements or Capacity Utilization (2005). Available at SSRN: https://ssrn.com/abstract=881727 or http://dx.doi.org/10.2139/ssrn.881727

Joze P. Damijan (Contact Author)

University of Ljubljana, Slovenia - Department of International Economics ( email )

Kardeljeva ploscad 17
Ljubljana, 1000
Slovenia
+386 61 189 24 00 (Phone)
+386 61 189 26 98 (Fax)

Crt Kostevc

University of Ljubljana - Faculty of Economics ( email )

Kardeljeva ploscad 17
Ljubljana, 1000
Slovenia

Register to save articles to
your library

Register

Paper statistics

Downloads
69
Abstract Views
539
rank
329,890
PlumX Metrics