Total Factor Productivity,Economic Policy Uncertainty And Firms Export Activities

With China's accession to the World Trade Organization,the process of the internationalization of Chinese firms has become a common concern of all sectors of society.An in-depth analysis of Chinese firms export activities has important practical implications for China's foreign trade and even economic growth.This paper empirically tests the effect of firms' total factor productivity and the economic policy uncertainty on firms' export activities based on the Probit model,using the micro-level date of the Chinese Industrial Firms Database from 2000 to 2007.What's more,this paper further explores the interactive effect of firms' total factor productivity and the economic policy uncertainty on firms' export activities.The main conclusions of this paper are as follows.(1)The effect of the total factor productivity on firms' export activities is significantly positive,which means the higher a firm's total factor productivity,the more likely it will export;(2)The effect of the economic policy uncertainty on firms' export activities if significantly negative,which means the higher the economic policy uncertainty a firm faces,the less likely it will export.(3)When take the influence of firms' total factor productivity into consideration,the effect of economic policy uncertainty on firms' export activities presents a nonlinear �U-shaped� relationship.For firms with lower productivity,the degree of the negative effect of economic policy uncertainty on their export activities will be weaker.And when the productivity of a firm exceeds a threshold,a sufficiently high productivity will weaken the negative effect of the economic policy uncertainty on its export activities.Finally,this paper proposes some related policy recommendations based on the above conclusions.