Hidden Champions - How Young and Small Technology-Oriented Firms Can Attain High Export-Sales Ratios
33 Pages Posted: 13 Jul 2006 Last revised: 26 Aug 2008
Date Written: 2006
Abstract
Determinants of a firm's export-sales ratio (degree of internationalisation) are frequently discussed in the literature related to individual firms' export activities. Stylised facts show a positive relationship between firm size and firm age on the one hand and the firm's export-sales ratio on the other hand. However, anecdotic evidence and recent empirical results revealed that it is not size or age per se that leads to a high export-sales ratio. This paper analyses the export-sales ratio of a sample of young technology-oriented firms in Germany and the UK. The empirical results confirm that neither youth nor smallness are necessarily an obstacle to realising a high degree of internationalisation. However, this requires that the firms possess firm-specific assets in order to overcome barriers to entry into the foreign market. These firm-specific assets may be acquired via conducting own R&D activities, buying novel technology from other companies, or by employing internationally experienced managers.
Keywords: High-technology industries, export-sales ratio, fractional logit model
JEL Classification: F23, L60, L86
Suggested Citation: Suggested Citation
Do you have a job opening that you would like to promote on SSRN?
Recommended Papers
-
Exports and Productivity: A Survey of the Evidence from Firm Level Data
-
Market Entry Costs, Producer Heterogeneity, and Export Dynamics
By Sanghamitra Das, Mark J. Roberts, ...
-
Firm Heterogeneity, Exporting and Foreign Direct Investment: A Survey
By Richard Kneller and David Greenaway
-
Participation in Export Markets and Productivity Performance in Canadian Manufacturing
By John R. Baldwin and Wulong Gu
-
Export Entry and Exit by German Firms
By Andrew B. Bernard and Joachim Wagner
-
Export Behavior and Productivity Growth: Evidence from Italian Manufacturing Firms