Firm Export Research Articles

Environmental information disclosure and firm export: evidence from China

In this paper, we empirically investigate how a governmental environmental information disclosure (EID) program in China affects the extensive and intensive margins of export for a panel of Chinese industrial firms. The results show that stricter enforcement of environmental disclosure discourages firms’ participation in export. However, the export volume of remaining exporting firms increases following more environmental disclosure. The results are robust to a battery of robustness checks as well as an IV estimation. Mechanism analysis reveals that firms’ propensity of innovation increases after stricter enforcement of disclosure, lending support for the Porter hypothesis.

Internetization and the markups of export firms: Evidence from China

Can internetization help Chinese exporting firms escape the “low markup trap”? We contend that it does, as internetization improves firms' capabilities and efficiencies in gathering and communicating information. We incorporate information costs and firm innovation choice into a heterogeneous firm model to test this hypothesis. The causality between firm-level internetization and markups is identified with a new instrumental variable designed to capture exogenous shocks to firm-level Internet exposure. After analyzing various internetization strategies, including social media, emails, and homepages, our results indicate that internetization directly increases the markups of Chinese exporting firms. In addition, with the enhanced information availability, internetization stimulates their innovation activities. Thus, we identify innovation as one channel, among others, through which internetization indirectly boosts the markups of China's export firms.

Sequentially exporting products across countries

Exploiting disaggregated data on French exporters, we show that firms expand their product scope and geographical presence sequentially. This process of internationalization is uneven over time, exhibiting more volatility early than later in the life cycle of exporters. Specifically, young exporters are particularly likely to exit, and if they keep exporting, to expand at the intensive and sub-extensive margins, doing so by widening product scope within a destination before entering new destinations. We also find that firms' core products are particularly resilient despite being used to “test the waters” when entering additional countries. Existing models of firm export dynamics are not designed to explain these empirical regularities. We argue that they can be rationalized by a mechanism where new exporters are uncertain about the profitability of their products in different markets, but learn from their initial export experiences and then adjust their sales, number of products and destination countries accordingly.

Economic and financial performance of Indian IT services export firms

This paper examines the economic and financial performance of the Indian IT services export sector. Specifically, economic performance is measured by total factor productivity (TFP) growth and financial performance is examined in terms of factors explaining accounting and market returns with the aid of seventy-six firm data set over a twelve year period (2004–2016).While thirty years of rapid development in the Indian IT services export sector is well documented, this paper suggests that much of the growth is attributable to replication rather than innovation. Results support the proposition that growth in the real output of Indian IT services sector is predominantly due to growth in real inputs (96%), as TFP accounts for only 4%. In addition, our estimation of Cobb-Douglas production function suggests modest economies of scale in the range of 1.06–1.14. With respect to financial performance, regression results confirm the important role of asset turnover, dividends, and debt in explaining accounting return measured by return on assets (39% adjusted R2). On the other hand, as expected, regression results explain only 10–14% (adjusted R2) of market return, which is total return on stocks including dividends. Statistically significant variables affecting market returns are: exchange rate, asset turnover, payout ratio, and standard deviation of the market return itself.

The Impact of Environmental Regulation on Firm Performance: Evidence from the Pulp and Paper Industry in China

In areas with serious pollution problems, the government designates a special emission limit (SEL) for pollution control and environmental protection in China. This paper examines the effects of chemical oxygen demand (COD) SEL on firms' production activity and market performance in the pulp and paper industry in the Lake Tai area in China. Using firm-level data, we employ a difference-in-differences strategy and find that SEL has a negative impact on the production scale, profitability, and market size of the regulated firms, while showing no significant impact on firm exports. The heterogeneity tests suggest that the impact of SEL on production and market performance varies with firm ownership, firm size, and target market. The reallocation effect of production shifts extra production from exited firms to existing firms, which explains the expansion of production scale and market size for SOEs and large-sized regulated firms. Compared with the decline of production scale, the inventory alleviation effect reduces the negative impact of stricter environmental regulation on firm performance.

Export Boosting Policies and Firm Performance: Review of Empirical Evidence Around the World

Abstract How effective are government policy attempts to boost firm exports in the short-run? We answer this question by conducting a review of 33 studies from 26 countries around the world, and provide nine findings. Export boosting policies are defined as a group of public policies that aim to increase firm exports in the short-run. These include policies such as export promotion, export-oriented public grants, public export guarantee schemes and subsidised export loans. Our review provides insights into policy effectiveness with respect to extensive and intensive export margins, as well as firms’ production function inputs and its outputs. The heterogeneity of effects across firm characteristics is emphasised, and the discussion is enriched with new evidence of spillover effects from export boosting policies. Finally, we summarise back-of-the-envelope calculations of the cost-benefit analysis and provide recommendations for future research.

Internationalisation, knowledge intensity, adaptive culture and absorptive capacity: a strategic entrepreneurship enabling logic for export firms

PurposeThis study proposes a logic to enable strategic entrepreneurship for export firms through absorptive capacity and adaptive culture to capitalise on the knowledge intensity from internationalisation.Design/methodology/approachThe study sample comprises 422 key role employees at 98 export firms in Ho Chi Minh City, Vietnam. The data are analysed using a structural equation model.FindingsThe results reveal that the firm's knowledge intensity may serve as a reservoir, absorbing and reconciling knowledge acquired from internationalisation and redistributing it to strategic entrepreneurship. A firm's absorptive capacity and adaptive culture can act as buffers, allowing internationalisation knowledge to permeate and transfer to administrative bodies and fostering strategic entrepreneurship.Originality/valueThis study proposes an integrated model of the relationship between the degree of internationalisation and strategic entrepreneurship through novel lenses of knowledge-based perspective with the organisational capabilities.

Industrial agglomeration and firm exports: Micro-evidence based on input-output linkages

Industrial agglomeration and firm exports: Micro-evidence based on input-output linkages

How Vietnamese Export Firms Faced Financial Distress during COVID-19? A Bayesian Small Sample Analysis

A crucial role belongs to export firms in the export-led growth model of Vietnam. The COVID-19 disease has posed a serious challenge to the Vietnamese economy, having negatively impacted its influential export sector. However, investigating this export sector encounters small sample issues within the frequentist framework. So, by adopting a Bayesian approach, this study intends to explore the impact of COVID-19-specific factors on the financial distress of the export companies listed on the Vietnam stock exchange. In case frequentist and Bayesian estimation with non-informative priors cannot acquire statistical efficiency due to problems with insufficient data, thoughtful Bayesian analysis can yield meaningful outcomes. A Bayesian logistic regression model was employed to analyze the scarce data, and the posterior estimates of all the model parameters achieved significantly show that the main operating cash flow ratio to total debt, company size, and retained return on total assets are all negatively related to financial distress. Interestingly, financial leverage positively affects financial distress because a benefit from a tax shield could not compensate for the adverse impact of a debt burden, as suggested in the trade-off theory, which demonstrates the specific financial situation of the companies when the COVID-19 pandemic was in full swing.

Drivers and outcomes of sustainable export marketing strategies in international environments

PurposeThis study aims to investigate the relationship between market-oriented environmental sustainability (MES) and green export-related resources and capabilities, analyzes the impact of these resources and capabilities on the eco-friendly export marketing strategy and assess the influence of such strategy on export performance.Design/methodology/approachThis study uses survey data from 241 manufacturing export firms analyzed through partial least squares structural equation modeling.FindingsThe results show a positive influence of MES on green export-related resources and capabilities. Further, while green export-related capabilities directly affect eco-friendly export marketing strategy, resources only influence it indirectly through capabilities. The results also show that the adoption of an eco-friendly export marketing strategy contributes to firm’s export performance.Originality/valueThis study makes an important contribution to sustainability and exporting literature by evaluating the behavior of firms in terms of MES and eco-friendly export marketing strategy.

Servitization, Market Power and Export of Firms

Servitization, Market Power and Export of Firms

The Crucial Role of Supply Chain Agility and Firm's Export Commitment on Export Performance: the Mediatory Role of Innovativeness, Responsiveness, and Competence, Complemented by Market Dynamics

The Crucial Role of Supply Chain Agility and Firm's Export Commitment on Export Performance: the Mediatory Role of Innovativeness, Responsiveness, and Competence, Complemented by Market Dynamics

Deep Trade Agreements and Heterogeneous Firms Exports

Deep Trade Agreements and Heterogeneous Firms Exports

Why are exporters more gender-friendly? Evidence from China

Although export orientation has been found in some studies to enlarge the female employment share in firms, the explanatory channels have received limited empirical attention. This paper seeks to fill this gap by studying the link between firm export activity and female employment share using matched employer-employee data from China. We find that the female employment share tends to be larger, and the gender earnings gap tends to be smaller in exporters than in non-exporters after controlling for the characteristics of both the employees and their employers. The channel analysis reveals that exporters’ gender-friendlier behaviors are more likely to be driven by cost-competitive motivations rather than by international laws or the exploitation of gender comparative advantages. Further analysis shows that the production profession, non-SOEs, and firms with lower management efficiency in China tend to be more sensitive to market competition. • We find that exporters tend to hire more females using matched data from China. • The larger share of females goes together with a smaller gender earnings gap. • The channel is that exporters need to be cost-competitive in the foreign market. • Some alternative channels like females' comparative advantage are ruled out. • Our analysis enriches the empirical evidence regarding the channels of interest.

Tickets to the Global Market: First US Patent Awards and Chinese Firm Exports

Tickets to the Global Market: First US Patent Awards and Chinese Firm Exports

Tickets to the Global Market: First US Patent Awards and Chinese Firm Exports

Tickets to the Global Market: First US Patent Awards and Chinese Firm Exports

The Effects of ESG Performance on Export Intensity of Korean Firms

Purpose – This study examines whether the export intensity of firms listed in the Korean market is affected by environmental, social and governance (ESG) ratings. We test whether the environmental, social, and governance (ESG) performance in ratings of Korean firms can improve their export intensity in the global markets. Design/Methodology/Approach – In this study, we introduce ESG ratings, export intensity and other control variables in the models using unbalanced panel data of 1,974 firms listed on the KOSPI and KOSDAQ Exchange between 2012 and 2021 from a merged dataset of the KIS-VALUE and TS-2000 databases. We apply the fixed effects model (FEMs) after applying the Hausman and Lagrangian multiplier tests. Also, we apply instrument variable regressions (IV regressions) to control endogeneity in ESG ratings affected by other factors introduced. Findings – First, higher ESG ratings of the firms have a significantly negative effect on export intensity, which is inconsistent with the results of the previous research (Herding and Poncet, 2014). Second, ESG ratings of chaebol firms do not significantly reduce export intensity. The results might be due to the less severe constraints in chaebol firms by ESG costs. (Chaney, 2008; Shi Xin-Zheng and Xu Zhu-Feng, 2018). Third, each ESG rating, E, S, and G individually, shows a significantly negative effect on export intensity for only non-chaebol firms, while such an effect for chaebol firms is not statistically significant. Fourth, using the instrument variable regression, we have verified the result that ESG performance has a negative effect on firms' export intensity. Research Implications – This study is the first to examine the relationship between the ESG ratings of Korean firms and their export intensity, whose result is different from that of a prior study regarding Chinese firms (Wu Qing-Lan, Chen Gui-Fu, Han Jing and Wu Li-Yan, 2022). The negative effects of ESG ratings in Korea on exports for non-chaebol firms suggest that higher ESG ratings of Korean firms are not favorably accepted by their counterparts in the global markets while their efforts to get or enhance higher ratings incurring more expenses might hurt their competence in the global markets. Such negative effects of ESG ratings are not clearly observed for chaebol affiliated firms.

The difference between exporter and non-exporter knowledge-based firms: the case of Iranian firms in the chemical industry

PurposeThis study aims to compare the level of organizational capabilities of the exporter and non-exporter Iranian knowledge-based firms in the sector of chemical technology.Design/methodology/approachBy combining 18 different indicators, a framework is designed to demonstrate organizational capabilities. The technological, manufacturing, R&D, marketing, organizing and financial capabilities of 732 Iranian knowledge-based firms in the sector of chemical technology (90 exporters and 642 non-exporter firms) are identified between 2015 and 2020. The analysis is based on the Chi-square test and logistic and probit regression.FindingsThe results indicate that technological capability, unlike the other five capabilities, is higher in non-exporter firms, and the level of marketing capability is greater in exporter firms, with the highest difference between the two groups.Originality/valueThe research suggests that knowledge-based firms should be evaluated based on export history; there should be some specialized export facilitating packages for both exporter and non-exporter firms; and some baskets from products with related and specialized fields of application should be formed to facilitate international marketing. The results can be a basis for managers and policymakers to improve the firm’s capabilities and competitiveness at the international level.

EXPLORING THE COMPLEMENTARY EFFECT INNOVATION STRATEGIES ON FIRM’S EXPORT PERFORMANCE

Innovation is an important requisite for firm growth. It provides competitive advantage to firms in both domestic market and in international market. Past studies have examined the effect of different types of innovation and their pair-wise combination on exports. However, the role of all types on innovation may have more complementary effects on exports of firms. The purpose of this study is to analyze the role of quadruple-complementarity among different innovative strategies in promoting exports of firms using the data of World Bank Innovation surveys and different World Bank Enterprise surveys of year 2013 for Pakistan, Bangladesh, and of year 2014 for India. Estimation is carried out using logistic regression. The finding indicates that existence of quadruple complementarity among different innovation strategies in innovation-export relationship, suggesting that, export’s sales of firm will be greater by simultaneously adopting all innovation strategies compared to adoption of either strategy. This study help in accessing integrated effect of different types of innovation strategies on exports of firm.

Trade intermediation by producers

This paper shows that manufacturing exporters export goods that they have not produced and thus also act as trade intermediaries. The geographical dimension of the data reveals that almost half of these exports of “sourced” products are purely intermediated: to many destinations, firms export sourced products only. We find that this type of intermediation is ubiquitous across firms, products, and destinations, and is robust to a battery of alternative definitions. These findings show that trade intermediation by producers (TIP) is not solely driven by carry-along trade, where produced and sourced products are bundled when exported. Our decomposition of TIP highlights that trade intermediation should be identified at the firm-product-destination level. The prevalence of pure intermediation for all manufacturing exporters, including the largest ones, suggests that intermediation plays an important role in firms' participation and success in international markets.