Does export promotion enhance firm-level intensive margin of exports? Evidence from a meta-regression analysis

Binyam Afewerk Demena

Journal of Asian Business and Economic Studies, 2024, vol. 31, issue 4, 250-262

Abstract: Purpose - The impact of export promotion programs (EPPs) on the intensive margin of exports remains somewhat uncertain. This study tackles a crucial question: does export promotion enhance firm-level intensive margin of exports? Design/methodology/approach - We draw upon comprehensive empirical research conducted up to 2023. We collected 951 estimates, constructed 22 variables, captured diverse contexts and employed a meta-analytical approach to scrutinize the considerable variation in findings. Findings - The overall meta-effect, after filtering out publication bias, is positive and statistically significant. Firms receiving EPP support exhibit an export intensity that is 1–9% higher than firms not participating in such programs. Assessing the mechanisms through which EPPs bolster this, we observe that support in the form of various services plays a more substantial role compared to assistance in the form of financial resources. Research limitations/implications - Evaluating EPPs and their activities in terms of social welfare falls beyond the scope of this paper, which specifically focuses on the benefits of EPPs to export intensity. Subsequent research should undertake a comprehensive evaluation, considering both economic impacts and costs for accurate assessments of welfare. We also suggest that future meta-analyses explore other dimensions of firm-level performance linked to EPPs. Practical implications - Publication bias distorts the impacts of EPPs, leading to an overstatement of their actual effects. Adjusting for publication bias, the practical significance of EPPs for a country’s trade intensity appears to be limited. Additionally, the provision of diverse activities and services primarily contributes to the amplification of export margins as compared to subsidies and grants. While larger firms initially benefit more from EPPs, these effects are found to be transitory. Originality/value - This is the first meta-analysis scrutinizing the impact of EPPs, specifically concentrating on the firm-level intensive margin of exports.

Keywords: Export promotion; Firm export performance; Intensive margin; Meta-analysis; F13; F14; L25; O11 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jabesp:jabes-10-2023-0412

DOI: 10.1108/JABES-10-2023-0412

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