Export Behavior and Firm Productivity in German Manufacturing - A Firm-Level Analysis

This paper examines the causal relationship between productivity and
exporting in German manufacturing. We find a causal link from high productivity
to presence in foreign markets, as postulated by a recent literature on international
trade with heterogeneous firms. We apply a matching technique in order
to analyze whether the presence in international markets enables firms to achieve
further productivity improvements, without finding significant evidence for this.
We conclude that high-productivity firms self-select themselves into export markets,
while exporting itself does not play a significant role for the productivity of
German firms.