Introduction to the Special Issue: Causes and Consequences of International Firm Activities – Evidence from Micro Data

Abstract

The study of international firm activities forms a very active sub-field of international economics with direct implications for economic policy. In this literature, micro-econometric investigations using longitudinal data at the firm level and micro-economic modelling of heterogeneous firms that are involved in various forms of international activities mutually fertilize each other (see the surveys by Greenaway and Kneller (2007), Helpman (2006), Lopez (2005), and Wagner (2007)). Members of The International Study Group on Exports and Productivity – ISGEP contribute to this literature, and new results are presented and discussed at the workshops of this group regularly. 1 Earlier versions of three of the four papers in this issue were presented at the third ISGEP workshop at the Economic and Social Research Institute (ESRI) in Dublin in February 2009. 2 Sourafel Girma, Holger Gorg and Joachim Wagner use newly available representative panel data for manufacturing enterprises in West and East Germany to investigate the link between production-related subsidies and exports. They report that only a small fraction of enterprises is subsidized, and that exports and subsidies are positively related. Using a matching approach to investigate the causal effect of subsidies on export activities they find no impact of subsidies on the probability to start exporting, and only weak evidence for an impact of subsidies on the share of exports in total sales in West Germany but no evidence in East Germany.