Productivity And Firms Export Behavior

Based on the new-new trade theory this dissertation investigates the mutual influence between productivity and firms’ export from perspective of heterogeneous, and using China Industry Business Performance Data we have analyzed the "Self-Selection" and "Learn-by-Export" effects. The mutual influence between productivity and firms’ export is an important content of enterprise heterogeneity model and the most forward direction of international trade. There are two approaches in the research of this area:the first one is "Self-Selection" effect which is learning about productivity how to affect export decisions; The second one is "Learn-by-Export" effect which is learning export how to affect productivity. Most of existing research has proved that the productivity is the most important factors that affect enterprise export decision, but the conclusions about how export affect productivity is quite different, however the conclusion about"Self-Selection"and "Learn-by-Export" for Chinese firms is varied. Therefore multi-dimensional comprehensive analysis of the relationship between productivity and firms’ exports can complement and supplement the applicability of new-new trade in china, which has important theoretical significance. From a macro perspective, the productivity can not only affect the international competitiveness of China’s enterprises, but also the transformation of the mode of economic development of China. When domestic demand cannot increase quickly in short term, exports as the most important factors of stimulating economic growth in China is still necessary for our macro-economic growth in future.In the theory part, this dissertation has introduced the development of international trade that is from mercantilism to the new-new trade theory, and mainly summarized the content of new-new trade theory and research achievement of empirical study in this area. Then using Melitz model and firm heterogeneity model analyzed the mechanism of the mutual influence between productivity and firms exports, In order to compare differences of different productivity results, we also introduced three most commonly used ways of productivity measurement which is easy for productivity analysis and empirical research.Our data comes from China’s industrial enterprise database (1999-2007), which can represent the characteristics of Chinese firms because of its wide information. Then this dissertation analyzed the characteristic of firms’ productivity from different ownership, different regions and different industries. From the perspective of ownership, we found that state-owned firms have lowest productivity while foreign companies have the highest productivity. Different region’s results show that the productivity of firms in east China is significantly higher than the mid and west China, and the results from different industries show that capital the productivity of intensive industry is much higher than labor intensive industry. We also found that the export subject and export patternhave duality in china. The result of main part of export shows that private firms, Foreign firms, Hong Kong-Macao-Taiwan firms completed most of the china’s exports, and state-owned firms export took the lowest proportion. From the perspective of export pattern, we found that the proportion of processing trade in china is much higher than general trade. What’s more, this dissertation found that the productivity, firm size and wage of export firms are higher than non-export firms, and this conclusion is suitable for all ownership,lregions and industries of China.There are three parts in the empirical research of "Self-Selection" effect.(1) Based on the extent export decision models we use all sample to do regression, the results show that productivity has a negative effects on export probability, which means firms with lower productivity have higher export probability, and Chunding Li called this phenomenon "productivity paradox".(2) from the perspective of ownership, the regression results show that foreign firms have "self-selection" effects, but others show the phenomenon of "productivity paradox", and private firms, Hong Kong-Macao-Taiwan firms’productivity paradox is more significant which may be related to its high proportion of processing trade.(3) The regression results of different regions shows that center, northeast and east of China do not conform to the "self-selection" hypothesis, but the result of west China is opposite. Besides productivity, Ex-export status, firm size and wage are important factors influencing the probability of firms export. Ex-export status can be proxy variable of sunk cost, and the significance of its coefficient means sunk costs are the important for firms export decisions.There are three parts in the empirical research of "Learn-by-Export" effects:(1) The regression results of overall sample show that exports will bring short-term growth of productivity, in medium to longer term export will not affect and even hinders the productivity growth of firms, which means that firms in China only have short-term "Learn-by-Export" effects. Export scale can also promote productivity in the short term.(2)From the perspective of ownership, the regression results show that private firms, collectively-owned firms, HongKong-Macao-Taiwan firms experienced a brief productivity growth after exporting while exports hindered its productivity growth in in medium to longer term. Therefor Export scale can improve the productivity of private firms.(3)The regression results of different regions shows that both export status and export scales will promote the productivity of firms in east China, and the productivity of firms in mid and west China can only be positively affected by current export status. Beside export variable, wage, profit can affect firms’ productivity growth.Finally this dissertation has given policy recommendations base on previous research conclusion, accelerating the optimization and upgrading of processing trade, changing macroeconomic policy guidance to ensure the coordinated development of domestic demand and exports, building a good business environment for firms, offering fair treatment to different firms in order to promote market dynamics, the enhancing learning ability and independent innovation awareness of firms are important ways to ensure firms having more scientific and reasonable export behavior.