Can production subsidies explain China's export performance? Evidence from firm-level data

This paper analyses the relationship between production subsidies and firms’ export performance using a very comprehensive and recent firm-level database and controlling for the endogeneity of subsidies. It documents robust evidence that production subsidies stimulate export activity at the intensive margin, although this effect is conditional on firm characteristics. In particular, the positive relationship between subsidies and the intensive margin of exports is strongest among profit-making firms, firms in capital-intensive industries, and those located in non-coastal regions. Compared to firm characteristics, the extent of heterogeneity across ownership structure (SOEs, collectives, and privately owned firms) proves to be relatively less important.

R&D, product innovation, and exporting:evidence from UK new technology based firms

We examine the relationship between R&D, product innovation, and exporting for a sample of new technology based firms (NTBFs) in the UK. Allowance is made for selection bias and for endogeneity between innovation and exporting. Product innovators are more likely to export, but conditional on entering export markets successful innovation does not increase subsequent export intensity. Lagged productivity is strongly associated with exporting, supporting the view that efficient firms are better able to overcome the barriers to entering export markets. We also find strong evidence of the importance of internal R&D and of supply-chain collaborations in fostering innovation, and that formal commercial collaborations can be important in overcoming the (information) sunk costs of entering export markets. The use of e-commerce does nothing to boost entry into export markets, but the intensity of its use is associated with increased export intensity.

Corporate governance, managers' independence, exporting, and performance of firms in transition economies

Using data on 157 large companies in Poland and Hungary, this paper employs Bayesian structural equation modeling to examine the relations among corporate governance, managers' independence from owners in terms of strategic decision making, exporting, and performance. Managers' independence is positively associated with firms' financial performance and exporting. In turn, the extent of managers' independence is negatively associated with ownership concentration, but positively associated with the percentage of foreign directors on the firm's board. We interpret these results as indicating that concentrated owners tend to constrain managerial autonomy at the cost of the firm's internationalization and performance, but board participation of foreign stakeholders enhances the firm's export orientation and performance by encouraging executives' decision-making autonomy.

Corporate governance, managers' independence, exporting and performance of firms in transition economies

Using data on 157 large companies in Poland and Hungary this paper employs Bayesian structural equation modeling to examine interrelationships between corporate governance, managers' independence from owners in terms of strategic decision-making, exporting and performance. It is found that managers' independence is positively associated with firms' financial performance and exporting. In turn, the extent of managers' independence is contingent on the firm's corporate governance parameters: it is negatively associated with ownership concentration, but positively associated with the percentage of foreign directors on the firm's board. We interpret these results as an indication that (i) risk averse, concentrated owners tend to constrain managerial autonomy at the cost of the firm's internationalization and performance, (ii) board participation of foreign stakeholders, on the other hand, enhances the firm's export orientation and performance by encouraging executives' decision-making autonomy.

Export propensity, export intensity and firm performance:the role of the entrepreneurial founding team

We investigate how the characteristics and experience of the entrepreneurial founding team (EFT) affect the export orientation and subsequent performance of the businesses they establish, while allowing for the mutually reinforcing relationship between exporting and productivity. Using a sample of UK technology-based firms, we hypothesise and confirm that the set of EFT human capital needed for entering export markets is different from that required for succeeding in export markets. Commercial and managerial experience helps firms become exporters, but once over the exporting hurdle it is education, both general and specific, that has a substantially positive effect. The overall pattern of human capital effects on productivity is similar to those for export propensity. We also find evidence that productive firms are more likely both to enter export markets and to be export intensive, and that exporting boosts subsequent firm productivity.

The innovation value chain and export performance:a study of Taiwanese manufacturing industries

This thesis involves the secondary data of 1806 innovative manufacturing firms derived from the database of 2nd Taiwanese Innovation Survey. Three topics are researched. The first topic investigates the innovation value chain (IVC) in Taiwanese manufacturing firms. Previous IVC studies are all done in developed countries such as UK, Ireland, Northern Ireland and Switzerland, and it leaves the gap of those non-developed countries. The result shows the overall knowledge sourcing pattern of Taiwanese manufacturing firms presenting a complementary relationship which is consistent to the previous IVC studies. The main innovation input is still derived from internal R&D which suggests more utilisation of external knowledge may boost innovation outcome. Product innovation does enhance firm growth while process innovation reduces a firm’s productivity. The second topic uses the lens of IVC to investigate the difference of the innovation process from knowledge linkages to value added between high-tech and low- tech sectors. The findings indicate (1) there are significant differences in the IVC between high- and low-tech sectors, however these are defined; (2) how you define ‘sector’ matters i.e. the nature of the high-tech and low-tech differences varies depending on whether the technology definition is carried out at the industry or firm level; and (3) the high uncertainty of innovation cause the difficulty to predict firm performance especially for those firms with high intensity of innovation. The third topic investigates the innovation-exporting relationship and explores the determinants of export performance. Product innovation enhances export performance once a firm enters international markets while process innovation affects negatively on a firm’s likelihood of being an exporter. Furthermore, IP protection is found to affect directly export performance positively.

Investment liberalisation, technology take-off and export markets entry:does foreign ownership structure matter?

Before and after its accession to the WTO in 2001, China has undergone a far-reaching investment liberalisation. As part of this, existing restrictions on foreign ownership structure and mandatory export and technology transfer requirements imposed on foreign firms have been lifted in a number of industries. Against this background we identify the causal effects of foreign acquisitions on export market entry and technology take-off and evaluate whether the level of foreign ownership plays a role in stimulating these changes. Using doubly robust propensity score reweighted bivariate probit regressions to control for the selection bias associated with firm level foreign acquisition incidences, we uncover strong but heterogeneous positive effects on export activity for all types of foreign ownership structure. We also find that minority foreign owned acquisition targets experience higher likelihood of R&D, providing evidence that joint ventures can contribute positively to China's "science and technology take-off".

Explaining intermittent exporting:exit and conditional re-entry in export markets

Intermittent exporting is something of a puzzle. In theory, exporting represents a major commitment, and is often the starting point for further internationalisation. However, intermittent exporters exit and subsequently re-enter exporting, sometimes frequently. We develop a conceptual model to explain how firm characteristics and market conditions interact to affect the decision to exit and re-enter exporting, and model this process using an extensive dataset of French manufacturing firms from 1997 to 2007. As anticipated, smaller and less productive firms are more likely to exit exporting, and react more strongly to changes in both domestic and foreign markets than larger firms. Exit and re-entry are closely linked. Firms with a low exit probability also have a high likelihood of re-entry, and vice versa. However, the way in which firms react to market conditions at the time of exit matters greatly in determining the likelihood of re-entry: thus re-entry depends crucially on the strategic rationale for exit. Our analysis helps explain the opportunistic and intermittent exporting of (mainly) small firms, the demand conditions under which intermittent exporting is most likely to occur, and the firm attributes most likely to give rise to such behavior.

Strategic Management of Resources for International Business Operations in Small Consulting Firms - People, Processes and Tools in Managing International operations

Research on strategic management of resources for small consulting firms which are international or planning to operate internationally is scarce or not existing at all. It is however important to start generating the theories that will support managers in their decision making and planning. This thesis investigates how do small management consulting firms manage their internal and external resources while operating in international markets. Throughout the study, aspects related to internal and external resources management as well as management strategies in these firms have been examined in relations to firm’s internationalisation activities. A qualitative analysis was carried out whereby four small consulting firms in Export Management Consulting, Integration Services Consulting-, Software Development Consulting- and Business Solutions Consulting companies were interviewed. In order to generate the holistic understanding of the study, the thesis writer selected Value Enhanced Collaborative Working (VECW) model as an analysis framework. The model focuses on people, processes and tools as key elements that small consulting firms consider when thinking about managing their international operations. The findings of the thesis reveal that, internal and external resources in the interviewed consulting firms are viewed similarly, but managed differently depending on the nature and size of the firm. Firm’s management strategies concentrate on the adequate utilisation of the employees' motivation and experiences, effective stakeholders' management, various administrative evaluation processes and tools, the ability to realise useful networks, constant improvement through employee trainings, employees and customers’ feedbacks as well as enhanced freedom in order to support employees’ creativity. Further research to examine functional administrative tools and tools that small consulting firms could use to assess their resource capabilities when planning to become international would benefit the smaller businesses in terms of resources management and certainty in planning.

Export and import market-specific characteristics. How they drive the decision to trade and how much

Using a rich firm-level dataset on the Italian manufacturing industry, this paper provides a comprehensive analysis of the role that firms and market characteristics play in shaping firms’ trade activities. We enhance the previous analyses by considering firms’ engagement in international transactions, by focusing on either exports or imports. We show that the determinants of a firm’s export participation and value across countries also drive import behavior. Our research is consistent with the presence of country-specific sunk costs and with a qualitatively similar role of gravity forces and other country attributes on both sides of trading activities. Our evidence, however, militates in favor of a framework where variations in market characteristics have a larger impact on imports than exports.