Export Diversity Research Articles

Antecedents and performance outcomes of exporters’ use of internet B2B platforms

PurposeThis study aims to develop and test a framework of the antecedents to and performance outcomes of exporters’ use of different services offered by Internet-based Business-to-Business (I-B2B) platforms.Design/methodology/approachWe test the model based on a unique survey dataset of 350 Chinese exporters who subscribed to Alibaba.com, a major I-B2B platform.FindingsDrawing on the signaling theory, export and I-B2B platform literature, we develop a typology of exporters’ use of services offered by I-B2B platforms. We find that the extent to which firms have cost efficiency advantages, adopt an export diversity strategy, operate under high levels of psychic distance and experience high levels of domestic regulatory uncertainty are all positively related to exporters’ use of I-B2B platform services. The use of those services is either positively or negatively related to export success depending on the services in question. The magnitudes of these performance relationships are contingent on the exporters’ transparency strategies.Originality/valueThis is the first study to examine the antecedents to and consequences of exporters’ use of the services offered by I-B2B platforms.

Gender matters: board gender diversity and firms’ export resilience

This study investigates the impact of board gender diversity on the export resilience of Chinese A-share listed firms from 2009 to 2015. Our findings indicate that board gender diversity significantly enhances firms’ export resilience. The results remain robust across various modifications, including adjustments to the sample period, exclusion of extreme values, utilization of alternative measures for critical variables, addressing endogeneity concerns by adding fixed effects and employing the sex ratio at birth as an instrumental variable. Mechanism tests reveal that enhancing the quality of export products, expanding export diversity, and improving corporate reputation are crucial pathways through which board gender diversity can bolster firms’ export resilience. Finally, heterogeneity analysis shows that the positive effect is more pronounced in older firms and those with higher board educational backgrounds. This effect is also more prominent in firms located in provinces with higher levels of non-state economic and product market development.

The Effect of Industrial Intermediate Inputs on the Export Diversity of Chinese Enterprises

China has put forward the policy direction of domestic market integration in response to the volatile domestic and international political and economic environment. Meanwhile, enterprise export diversification is becoming the research frontier of the new trade theory (NTT). In order to make research on the factors affecting or determining export diversification in the contemporary context, this paper links the trend of domestic market integration with export diversification, and constructs a fixed-effects regression model using the Chinese industrial-enterprise customs matching database from 2000 to 2007 to study the relationship between industrial intermediate inputs and export diversification and the enterprise heterogeneity effects. According to the empirical results, it shows that the increase of intermediate inputs can promote the export diversification. The results of the heterogeneity analysis show that such kind of effect also varies depending on the differences in firm ownership, firm location, firm trade patterns, and capital intensity. In such a case, in order to complete the industrial upgrading of the domestic value chain and upgrade the export industrial structure under the trend of domestic market integration, it is necessary to pay attention to the liberalization of intermediate goods trade and the improvement of relevant policy conditions.

The impacts of resource abundance and export diversity on financial development in the South Asian economic bloc

One of the most essential aspects of a nation’s economic progress that determines the citizens' lifestyles and general wellbeing is the level of financial development (FD). Thus, the current study examines the influence of natural resources as key variable for financial development in South Asian economic bloc while accounting for the roles of export diversity, inflation, and economic expansion. The dataset utilized for the South Asian bloc stretches between 1990 and 2020. Second-generation panel econometric approaches that are robust to slope heterogeneity and cross-sectional dependence were employed in the study. The relevance and applicability of the second-generation techniques was reinforced by some preliminary assessments while the cointegration checks confirm the existence of long-run interconnectedness between financial development and the regressors. The elaborate empirical analysis that was conducted shows that export diversity and natural resources abundance exert diametric impacts on financial development of the South Asian bloc. While the former positively influences financial development, the latter’s impact was significantly negative thereby signaling the resource curse tendency of the South Asian countries. Furthermore, the observed roles of economic progress and inflation on the bloc’s financial development were positive and significant. Therefore, authorities in the South Asian countries need to maintain greater regulatory oversight of the resources market to ensure that rent seeking and resource abuse are avoided at all costs towards building a more prudent fiscal mechanism within a stable financial system. Authorities also need to ensure that resources are fully efficiently utilized by channeling them to production activities that create value addition to resources to harness greater exports for improved FD levels. Other policy measures were also highlighted for the South Asian stakeholders in the main text.

Improvement of Local Speciality Rices as a Boon to Health, Wealth and Export Diversity: Case of Kalanamak Rice

A blessing from Lord Buddha some 3,000 years ago, and now a heritage rice of Uttar Pradesh, India is valued for its aroma, taste and nutritive quality. Its cultivation declined from 50,000 ha to less than 2,000 ha and was at the verge of extinction. No attention was paid for improving Kalanamak and it survived as landrace due to the mercy of the farmers. PRDF collected, catalogued and conserved 250 accessions of Kalanamak, and the best one, through Pureline selection, was released in 2007 and notified in 2010 as KN 3. Mutation breeding using gamma rays and EMS gave many academically interesting mutants but no high yielding dwarfs. Hybridization of KN 3 with Swarna Sub1 and Improved Sambha Mahsuri yielded varieties like Bauna Kalanamak 101, Bauna Kalanamak 102 and Kalanamak with shorter duration and 50% higher yield, released and notified in years 2016, 2017 and 2019 respectively. Protocol for organic production with higher yield was developed and certification under PGS arranged. Kalanamak is sugar-free with 49 to 52% Glycemic Index, 11% protein, 3 times higher Iron and 4 times higher Zinc. It is unique rice to have Vitamin A in form of Beta Carotene. Kalanamak is backed by Geographical Indication and PPV and FRA, and selling at five times higher price of common rice tripling farmers’ income. Now exported to Singapore, Nepal and Dubai has opened door to prosperity and added diversity to Basmati for export. This success story can be repeated for other land rices of speciality status.

Institutions Rule in Export Diversity

We used the data of 133 countries to explore the determinants of export diversity among candidate variables that are clearly exogenous or endogenous but with a well-established instrument. These candidates include geography, resource abundance, and institutional quality. Our results suggest that institutional quality is important in determining export diversity, and a country with better institutions has a more diversified export structure. Once institutional quality is controlled for and instrumented with European settler mortality, variables such as geography and resource abundance, which significantly determine export diversity in the baseline regression, are no longer significant. The results are still robust even using alternative measures of institutional quality. They also indicate that the mechanism whereby institutions largely determine export diversity has been presented under the guise of natural resource abundance and geography. Therefore, to some extent, the “natural resource curse” is not a curse, but simply two sides of the same coin.

Does a Stronger Business Environment Increase Export Variety?

ABSTRACT Optimizing the business environment is a new competitive edge to global economies in international competition and cooperation. Export variety is an important basis for the implementation of a country’s foreign trade diversification strategy. However, the impact of the business environment on export diversity remains unclear. Using World Bank Doing Business data and detailed product data of 145 countries from 2010 to 2018, we investigate the effects of the business environment on the export variety of home countries. We separate regulatory variables based on different stages of a firm’s life cycle and examine which regulatory factors of doing business influence export variety. The results show that business environment improvement promotes export variety through an increase in foreign direct investment (FDI). The improvement of the business environment promotes the export variety mainly in non-high-income countries but not in high-income countries. Dealing with construction permit negatively affect export variety, while trading across borders and resolving insolvency improve export variety.

How natural resources affect financial development? Fresh evidence from top-10 natural resource abundant countries

This study is to examine the impact of natural resources, economic growth, export diversity and inflation on financial development in top-10 natural resource abundant countries, spanning the period of 1990–2020. The empirical outcomes show that natural resources, economic growth, export diversity, inflation and financial development have long-run equilibrium relationship. Further, export diversity, economic growth and inflation increase financial development but natural resources reduce financial development in natural resource abundant countries. Furthermore, panel causality results show a unidirectional causality moving from financial development to export diversity and inflation. The empirical results offer new insights for policy makers to protect their natural resources for the betterment of financial development in top-10 natural resource abundant countries.

Export concentration and diversification impact on economic growth in the developed and developing countries of the world

There is much evidence that export diversity has a positive effect on economic growth, but there is some evidence that the concentration of exports may be also related to economic growth. The paper is dedicated to the relationship between export diversification and economic growth in developed and developing countries for 25 years (1996-2020) and 10 years (2011-2020). Correlation between concentration index (Herfindahl-Hirschmann Index), diversification index (modified Finger-Kreinin measure of similarity in trade) and economic growth was studied to confirm or deny the statements concerning positive or negative influence of export diversification and concentration on economic growth. The results of the study show that concentration index is lower in developed countries and does not varies much over time. While developing countries show higher magnitudes of this index and higher volatility level of this index and its relationship to the world business cycles. Level of export diversification is higher in developed countries, which show more similar export structure to the world pattern comparing with other national economies. Diversification index dynamics in developed and developing countries was getting closer to each other in 2012-2020 and now they are almost the same, though export diversification level of developed countries is a bit closer to the world export pattern comparing to the developing countries index. The findings show that in developing countries export concentration index has sufficient correlation with their GDP growth rates in both periods. That means the more key goods they sell the higher GDP growth rate they get. There is no long-time influence on economic development of these states according to this lagged correlation study of 1996-2020 period. Study based on 10-year period show sufficient 1-year lagged correlation rate, but the hypothesis concerning lagged positive impact of export concentration of economic development of these countries during the last decade needs proof. Developed countries have weak or moderate correlation between export concentration and GDP growth. Hence, developing countries mostly concentrate their export on a few primary goods but there is a need of additional research to find out if they use this money to develop other industries. Eventually there are different economies in these groups and some of them have different exports patterns and development models. Correlation analysis of the relationship between diversification index and GDP growth in 25-year period has shown weak or rather moderate association that does not give us possibility to make an assumption concerning the sufficient impact of export diversification on economic growth. However, in 10-year study we observe high correlation between these data in developing countries, especially in 5-year lag study. If in case of developing countries we observe positive relationship, analysis of developed countries indices shows negative relationship that confirms the statement about role of export diversification in economic growth of developed counties and export concentration - in developing economies. The more their export pattern deviates from the global structure (which is rather diversified) the higher their growth level is. Therefore, their export consists mostly of a few products. Negative relationship between diversification index and GDP growth in developed countries confirms the well-known statement that export diversification should promote economic growth. Lag dynamics in these cases needs additional studies. The list of issues of the following research also includes the search for a model of the nonlinear relationship between export diversification indices and growth rates in economies of different levels of development. The study has been also focused on the transition economies group, which has shown results more similar to those of developing countries comparing with developed economies. Export concentration index of transition economies is higher than in developing countries and more volatile; export diversification index is much bigger comparing with developing and developed economies. We state that these results reflect existing primary product export strategy of transition economies. The highest concentration and diversification indices are observed in countries that export energy resources. As a result of the study, the statement that the diversity of exports has a positive effect on economic growth was confirmed. The study has revealed that in developed countries economic growth usually are associated with diversified export basket. The study also showed that over the past 25 years, a developing economy to provide growth did not necessarily need diversified export. Number of countries have shown consistent economic growth driven by export of primary products.

DIVERSIFICATION OF TRADE-INTEGRATION RELATIONS OF UKRAINE

Introduction. In the open economy, the diversification of international trade and integration relations is one of the dominant factors in reducing the uncertainty of the external environment. The process of Ukraine's integration into the world economy intensified after the country's independence and was accompanied by numerous turbulences in the internal and external environment. The strategic task for Ukraine now is to develop and implement a balanced foreign economic strategy to create a competitive economy and justify measures to reduce its sensitivity to these adverse conditions by improving the mechanisms of foreign economic activity. The purpose of the article is a comprehensive assessment of the diversification of domestic trade-integration relations, taking into account the turbulence of the international economic space. Results. The main indicators of diversification of international trade and economic relations of Ukraine are analyzed, on the basis of which its key factors having a specific context and geographical character are singled out. The main problematic issues of development of domestic foreign trade in terms of external and internal factors are identified. The structure and dynamics of spatial and commodity diversification of trade and integration relations of Ukraine are considered. The main directions of increasing the export diversity of commodity flows are systematized and the tasks of expanding trade and economic ties and deepening the country's integration into the world economy are outlined. Conclusions. The degree of diversification of Ukraine's trade and integration relations is quite high and it is determined by the concentration of its efforts on creating favorable conditions for trade in EU markets. At the same time, there are numerous positive trends in the development of diversified trade and integration relations of Ukraine, which indicate the formation of a basis for further stimulation of exports of innovative and knowledge-intensive products and, consequently, greater competitiveness in world markets. Key words: diversification, world economy, international trade, international trade integration relations.

When Does Export Diversification Improve Economic Growth? A Comparative Analysis of Sub-Saharan African Countries

There has been increased interest in promoting export diversification as a means of ensuring sustainable growth in most developing countries. Yet, the arguments on the relationships between export diversity and economic growth is not settled in literature, with mixed findings concerning the sign and size of the correlation. This study assesses the relationship between export diversification and economic growth in selected Sub-Saharan African countries. Employing fixed effect and generalised least square regression models, with data from the World Bank, the findings show that a U-shaped relationship between export concentration and economic growth: the study finds a positive non-significant relationship for low-income countries, a positive and significant relationship for lower-middle-income countries and negative though not significant relationship for upper-middle-income countries.

Does aid for trade diversify the export structure of recipient countries?

AbstractThe importance of aid for trade as a tool for facilitating trade, economic growth and social development has received attention since the concept was introduced in 2005. While one of the main targets of aid for trade is export diversification, reflecting the fact that the exports of many developing countries are concentrated in a small range of items, there have not been many efforts to measure the effect of aid for trade on export structure. This study, therefore, attempts to trace the relationship between aid for trade and 133 aid recipients' export structure between 1996 and 2013. Using the Herfindahl–Hirschman Index to measure the degree of export concentration, the findings suggest that total aid for trade has reduced the concentration level in the short run. In the long run, on the other hand, aid for trade has had no significant effect on export structure of recipient countries. Only aid for building productive capacity, which is one of the three categories of aid for trade, contributes to lower concentration. Yet, this change is not caused by an increase in export diversity but by the redistribution of shares of existing products of a similar sophistication level.

Comparison of Business Environments in Oil-Rich MENA Countries: A Clustering Analysis of Economic Diversification and Performance

ABSTRACTThe purpose of present research is to cluster 11 oil-richest MENA countries; Algeria, Egypt, Iran, Iraq, Kuwait, Libya, Oman, Qatar, Saudi Arabia, Sudan, and the United Arab Emirates regarding economic diversification and performance during 2010–2016 using K-means algorithm which is a versatile data mining technique. The major finding is that higher export diversity in addition to better economic performance can influence competitiveness of business environment of the countries positively and vice versa. The studied nations are partitioned into four clusters. Qatar and UAE with highest economic diversity and performance have the most favorable business environments in the region.

Export diversity and the relevance of different forms of market experience

This study evaluates how different forms of human capital - i.e., formal management studies, labour market experience and experience in multinational businesses - explain the export diversity of SMEs, defined as the number of foreign market destinations where the business sells its goods or services. The proposed hypotheses are tested using negative binomial regression models on a unique sample of 117 Costa Rican SMEs for 2017. The findings reveal that labour experience in multinational firms - in particular, experience in managerial positions - is a relevant source of human capital that equip entrepreneurs with specific know-how that is conducive to export diversity, in terms of number of market destinations. Results also show that firm size, age and online sales (e-commerce) are positively correlated to export diversity. Beyond canonical export-related measures, this study offers insights on the importance of including the number of foreign markets (market destinations) in the evaluation of the export performance of SMEs.

Export diversity and the relevance of different forms of market experience

Export diversity and the relevance of different forms of market experience

Untangling the multiple effects of slack resources on firms’ exporting behavior

Drawing on a behavioral theory perspective, we investigate how distinct types of slack resources affect distinct aspects of firms’ exporting behavior. Using longitudinal data of Belgian manufacturing firms, we find that financial and human resource (HR) slack affect the probability of exporting positively at a diminishing rate. Controlling for the export decision, we find that HR slack affects export intensity negatively, while financial and HR slack affect export diversity positively at a diminishing rate. Findings are economically meaningful, especially for new exporters. Taken together, our study adds new insights at the nexus of the international business and slack literatures.

The elusive effects of trade on growth: Export diversity and economic take‐off

AbstractThe hallmark of the voluminous growth determinants literature is the absence of a clear‐cut effect of trade on growth. Numerous candidate regressors have been motivated by alternative theories and tested by a multitude of empirical studies, but not one trade regressor has been robustly related to growth. In this paper, we leverage Melitz's (2003) insights regarding sectoral export dynamics and Feenstra and Kee's (2008) approach to productivity and sectoral export diversity to propose a structured approach to trade and growth determinants. Instead of relying on aggregate trade measures as previous studies have done, we examine the diversity of sectoral exports and the development of broad‐based comparative advantage as a potential growth determinant. Controlling for model uncertainty and endogeneity, we find that export diversity serves as a crucial growth determinant for low‐income countries, an effect that weakens with the level of development.

Is Sri Lanka's marine products exports competitive? Analysis of fisheries exports of Sri Lanka

Fish .export industry in Sri Lanka has become a good source of foreign exchange earnings. The efficiency of the sector can be improved considerably through the development of its trade system. An attempt was made in this paper to determine the performance of fisheries sector trade, the degree of export diversity, the price competitiveness of fisheries product and the impact of fisheries export for the economic growth of the country. The present study is based on time series data pertaining to the period from 1995 to 2004. The data on value of export of fisheries product for Sri Lanka was collected from different volumes of External Trade Statistics reports. To study the composition of export of different fisheries products, percentage export value shores were calculated. The concentration rate of export fisheries products was estimated by using the Hirschman-Herfindhal Index. The Simpson Diversity Index was used to measure the diversity of exports of fisheries products. Export competitiveness of fisheries commodities was calculated by computing the Nominal Protection Coefficient (NPC). Results revealed that the compound growth rates of fisheries sector were 0.13 and 0.1 percent in terms of value of exports and quantity of exports respectively. The export diversification index fluctuated between 76 percent in 1995 and 68 percent in 2004. An examination of NPC for different fisheries products such as prawns, Crabs and Lobsters indicated that all the goods were competitive internationally, because all the values were less than unity every year. A regression analysis confirms that there exists a statistically significant and positive association between exports and economic growth in Sri Lanka. If Sri Lanka aims to achieve a high rate of economic growth through promoting exports then it has to minimize the fluctuations in export earnings, maintain export competitiveness and promote exports. AGRIEAST 2010 (9) p.36-41

Export Diversity and Human Rights

In this article, I synthesize a number of recent studies exploring how exports affect human rights, highlighting a common implication that this relationship is conditional on how exports are associated with leaders’ relative costs of repression and accommodation. Beginning with this synthesis, I develop a theory demonstrating how the composition of exports affects human rights via its impact on leader expectations. More diverse exports promote continued growth and prosperity, provide leaders with greater resources, and suggest conditions less conducive to severe dissent, all of which reduce the relative costs of accommodation. Repression is likely to threaten the benefits otherwise associated with greater export diversity; thus its relative cost increases amid greater export diversity. I test this theory using commodity-level data from the United Nations Comtrade database to create a country-year-level measure of export diversity. Statistical analyses spanning 1981 to 2009 support my expectation. My results are robust to sample restrictions and the use of instrumental variables.

Furtado’s “Economic Growth of Brazil”

This survey article reviews Celso Furtado’s most famous book and argues that he convincingly used the central elements of the Prebisch-ECLAC analytical construct—strucuturalism—to organize and study the economic history of Brazil from its discovery until the mid-twentieth century. Furtado shows how, throughout Brazilian history, successive cycles of economic growth before industrialization (mainly, the production of sugarcane in the Northeast in the seventeenth century, the gold cycle in Minas Gerais in the eighteenth century, and coffee production in the Southeast in the nineteenth and early twentieth centuries) have created, and thereafter perpetuated, some major characteristics of Brazilian underdevelopment: low production and lack of export diversity, as well as structural heterogeneity, specifically, a vast underemployed sector existing side by side with a high productivity modern sector.