The Influence Of Export Product Diversification On The Export Duration Of Chinese Enterprises

Export markets brings a huge overseas demand for Chinese export enterprises,meanwhile,Chinese export firms are exposed to the external risks.There are many uncertain factors in the international markets.Economic and non-economic factors are intertwined with each other.The dependence on external markets leads to a high correlation between Chinese exports and external shocks.“Stable export” has been a key point in the government work report.How to promote the smooth development of China's export trade becomes an urgent problem to be solved.At the micro level,this problem is embodied in how to improve the sustainable survival of export enterprises in the international markets.That is,it needs to conduct the research from the perspective of export duration.As opposed to classical and neoclassical trade theories,export product diversification theory emphasizes the positive impact of trade diversification on a country's economy.A lot of existing documents has confirmed that product diversification has a positive effect on economic growth and economic fluctuation.However,few literatures focus on the influence of export diversification on export activities from the perspective of export duration.Therefore,this paper employs discrete time duration models to examine the links between export product diversification and firm survival in export markets based on the matching data of China's customs database and Chinese industrial enterprises database during 2001-2006.We use HHI index to measure the level of export product diversification from the horizontal dimension.The findings including:(1)Overall,export diversification is a strategy to reduce export risks for enterprises.But there exists a U-shaped relationship between the export product diversification and firm survival risk rate in export markets and there is an optimal level of export product diversification for export firms.The survival data during the financial crisis also show that the export diversification enterprises at the intermediate level exit from the export market at a lower rate.(2)Export persistence is positively associated with the length of the export spell.As the export duration in the foreign market increases,export firms will know more about the market information and accumulate more export experience.Through the export learning effect,the enterprises can improve their ability to resist external risks and reduce the probability of exiting from the market.(3)There are regional differences and ownership differences in the influence of product diversification on the export duration of firms.For the state-owned and western firms,the concentration level is higher,so the linear relationship is more obvious.It is important role to improve the level of diversification to reduce export risk for them.(4)We confirmed the existence of productivity heterogeneity.The ability of high-productivity firms to resist the risk of over-diversification or overconcentration is stronger than that of low-productivity firms.(5)Besides,firm's characteristics also has an influence on firm survival in export markets.The longer export duration;the larger scale;the younger age;the higher initial export value;the stronger ability to reduce export risk,the more conducive to survival in the export market.Therefore,export enterprises cannot blindly expand the extensive margin.Different enterprises have different situations.It is absolutely necessary to consider the firm's abilities of production,organizational management,etc when the export enterprises choose the export diversification strategy.Otherwise,over-high level of diversification will make firms exposed to greater risks.