Exporting And Productivity

Recent international empirical evidence documents the higher productivity of exportersrelative to non-exporters. Three explanations for this phenomenon have been proposed:self-selection; conscious self-selection; and learning by exporting. We test these threehypotheses using Chinese industrial database manufacturing industry firm-level data from1998to2007.Through the preliminary analysis, we find that: the number of export enterprises has onlyaccounts for less than28%, but in the enterprise employment, value-added and stableaccounted for more than40%of the capital stock; Compared with the export enterprises,export enterprises in TFP, the added value of per capita, per capita, per capita sales of fixedassets, employment, wages, employee education expenses per person, per capita spending onresearch and development, new product output per capita, intangible assets, advertisingspending per capita, per capita profit per capita, per capita, accounts payable, accountsreceivable, the per capita capital stock per capita, per capita net investment in acomprehensive advantage; Export enterprises are divided into general trade export enterprisewith pure export processing trade enterprises, pure export enterprises export share of30%,and the TFP in the enterprise, the added value of per capita, per capita, per capita sales offixed assets, employment, wages, employee education expenses per person, per capita outputof new products, intangible assets, profit per person, per capita accounts payable, accountsreceivable, the per capita capital stock per capita compared to the export enterprises to dobetter.According to export state, enterprises are divided into non-exporters,permanent-exporters, entrant_stays, quitters, switchers, respectively accounted for70%,1.3%,11%,3.3%,11%of all companies. According to later more business productivity changetrack before export, we find that: entrant_stays have higher productivity than non-exporters,but there is a decrease before entering into exporting, but after enter foreign market, itsproductivity become more higher.Moreever,after four years engaged in exporting, they getmore higher productivity than non-exporters; comparing to non-exporters,permanent-exporters’ productivity is higher and more stable; quitters’ productivity is lowerthan non-exporters and continuous decline in the three years before exit exporting, after exitthe international market, its’ productivity increased.We find that firms that enter international markets show higher initial productivitycompared with non-exporters, consistent with self-selection; we also find strong evidence supporting the idea that self-selection is a conscious process by which firms increaseinvestment before entering international markets to increase productivity with purpose ofbecoming exporters. Moreover, we do not observe increases in productivity after firms beginto export, which is not consistent with learning by exporting. However, we find strongevidence supporting learning by exporting for permanent exporters that have been exportingand switchers that change export status more than once during the whole period. In addition,after considering processing trade by dividing the exporters into general exporters andprocessing trade pure exporters, we only find strong evidence supporting learning byexporting for general exporters.