Do domestic and foreign exporters differ in learning by exporting? Evidence from China

Julan Du, Yi Lu, Zhigang Tao and Linhui Yu ()

China Economic Review, 2012, vol. 23, issue 2, 296-315

Abstract: In view of the importance of intra-firm trade and export-platform FDI conducted by multinationals, we investigate how domestic firms and foreign affiliates exhibited differential impacts of export entry and exit on productivity changes. Using a comprehensive dataset from China's manufacturing industries, we employ the Olley–Pakes method to estimate firm-level TFP and the matching techniques to isolate the impacts of export participation on firm productivity. Robust evidence is obtained that domestic firms displayed significant productivity gains (losses) upon export entry (exit), whereas foreign affiliates showed no evident TFP changes. Moreover, the productivity gains for domestic export starters were more pronounced in high- and medium-technology industries than in low-technology ones. We explain our findings from the perspective of the technology gap theory after considering processing trade and the fragmentation of production stages in the era of globalization.

Keywords: Exporter heterogeneity; Export entry and exit; Total factor productivity; Foreign affiliates (search for similar items in EconPapers)
JEL-codes: D24 F14 L1 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (29)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:chieco:v:23:y:2012:i:2:p:296-315

DOI: 10.1016/j.chieco.2011.12.003

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