Exports; FDI; Heterogeneous Firms; Total Factor Productivity
Abstract :
[en] This paper tests some of the predictions of recent advances in trade theory
that have focused on different trade patterns of firms within the same
sector. Helpman, Melitz and Yeaple (2005) develop a model in which
innate productivity differences between firms determine the degree of
international engagement of firms: The least productive firms produce for
the domestic market, better performers engage in export activities, and the
top firms establish foreign subsidiaries. Using German firm-level data from
1996 to 2002, we test this prediction using non-parametric methods, by
examining the distribution functions of the three subsets of firms for
stochastic dominance. Rather than just comparing first moments, this
technique allows us to compare productivity over the entire distribution.
Our results show robust support for the prediction from theory.
Disciplines :
International economics
Author, co-author :
Arnold, Jens Matthias
Hussinger, Katrin ; University of Luxembourg > Faculty of Law, Economics and Finance (FDEF) > Center for Research in Economic Analysis (CREA)
Language :
English
Title :
Exports versus FDI in German Manufacturing: Firm Performance and Participation in International Markets
