Stylised facts consistently show that exporting firms are more productive than non-exporting firms. Germany is a case in point; productivity differentials are found in favour of exporting firms compared to firms that sell their products on the national market only. There are two alternative but not mutually exclusive hypotheses as to why exporters can be expected to be more productive than non-exporting firms. The first hypothesis points to self-selection of the more productive firms into export markets. The reason for this is that selling goods in foreign countries involves additional costs less successful firms cannot bear. The second hypothesis points to the role of learningby-exporting. Knowledge flows from international buyers and competitors help to improve the performance of exporting firms. According to this hypothesis, the productivity-increasing effect of international sales results from knowledge and expertise related to the foreign market that nonexporters do not have. A recent survey of 54 micro-econometric studies confirms that the more productive firms self-select into export markets. On the other hand, however, exporting does not necessarily improve productivity. One reason as to why the hitherto existing literature has often not found an impact of a firm's export activities on its labour productivity might be that most studies that empirically investigate the learning-by-exporting hypothesis only distinguish between exporting and non-exporting companies. Whether or not exporting has a positive effect on labour productivity might, however, not simply depend on a firm's export status, but might be a function of the extent of the firm's export activities. On the one hand, there are firms that only occasionally receive some unsolicited orders from abroad, whereas, on the other hand, some firms pro-actively exploit the potential of the foreign market, generating a high percentage of their total sales in the foreign market. In this paper, we analyse the causal relationship between firms' labour productivity growth rates and their export-sales ratios, using a large data set for German manufacturing firms and applying the newly developed continuous treatment methodology. We show that there is a causal effect of firms' export activities on labour productivity growth. However, exporting improves labour productivity growth only within a sub-interval of firms' export-sales ratios. Furthermore, we find that the relationship between labour productivity growth and the export-sales ratio is not stable over time. One reason for this surprising result might be that in recent years firms more frequently sell their products in more distant and technologically less advanced countries like India or China, reducing their chance to benefit from learning-by-exporting.
Die Discussion Papers dienen einer möglichst schnellen Verbreitung von neueren Forschungsarbeiten des ZEW. Die Beiträge liegen in alleiniger Verantwortung der Autoren und stellen nicht notwendigerweise die Meinung des ZEW dar.Discussion Papers are intended to make results of ZEW research promptly available to other economists in order to encourage discussion and suggestions for revisions. The authors are solely responsible for the contents which do not necessarily represent the opinion of the ZEW.Download this ZEW Discussion Paper from our ftp server:ftp://ftp.zew.de/pub/zew-docs/dp/dp0205.pdf Non-technical SummaryThe fast technological development of the Internet as well as the declining prices for the use of this technology have led to an increased diffusion of the Internet during the last few years. One important application of Internet technology for firms is so-called Internet commerce or electronic commerce. Although broadly discussed in the media and glorified as the most promising medium for ordering, buying and selling products and services, e-commerce is in fact still at the beginning of a diffusion process whereas e-commerce between companies (business-to-business or B2B) currently has a broader scope than e-commerce between companies and consumers (business-to-consumers or B2C). Since B2B e-commerce can be regarded as a new technology (application) or a process innovation, this study attempts to evaluate several hypotheses proposed mainly in the literature on technology diffusion or adoption, but also in the innovation literature. The empirical analyses are based on a data set comprising 3,000 enterprises from the German manufacturing industry and the German services sector in the year 2000. We find positive and significant effects of firm size, the share of highly qualified employees and the export share. An IT-intensive production process, measured by the proportion of employees working predominantly at a PC, the share of ICT specialists as well as the use of Electronic Data Interchange, enhances the probability of a broad use of B2B e-commerce. An important influence on the use of B2B is the bandwagon effect, implying that firms are more likely to use this new Internet application if others within the same industry likewise do it. We find no significant effects of firm age and of the fact that a firm belongs to a group of companies as measures of a firm's flexibility and financial power. 1The Adoption of Business-to-Business E-Commerce: Empirical Evidence for German Companies January 2002Abstract Although in its infancy, one promising application of Internet technology for firms is so-called Internet commerce or electronic commerce. This paper analyses the determinants of B2B (business-to-business) adoption borrowing from the literature on the adoption of new technologies and considering factors like firm size, corporate status, human capital and international competitive situation. An ordered probit model is applied to a data set containing about 3,000 enterprises from the German manufacturing i...
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