EconPapers    
Economics at your fingertips  
 

Technical barriers to trade and export performance: Comparing exiting and staying firms

Hao Wei, Yue Tu and Peng Zhou

Economic Modelling, 2023, vol. 126, issue C

Abstract: Technical Barriers to Trade (TBTs) present a major challenge to exporters and policymakers. Prior studies have shown that TBTs induce the exit of exporters, but little is known about the differences of subsequent export performance between exiting and staying firms. We investigate the case of Chinese firms suffering TBT shocks in the US market with the PSM-DID method. The results show that exiting firms gain higher export growth than staying firms by exploring new markets more extensively and exploiting other existing markets more intensively. Besides, we also find that staying firms gain higher prices and higher quality than exiting firms by conforming to the higher standards after TBT shocks. Our findings suggest that exporters can survive tough TBT shocks by optimizing within-firm reallocations of resources across markets and products.

Keywords: Technical barriers to trade; Exiting firms; Staying firms; Market switching; Product quality (search for similar items in EconPapers)
JEL-codes: F13 F14 L25 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0264999323002511
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecmode:v:126:y:2023:i:c:s0264999323002511

DOI: 10.1016/j.econmod.2023.106439

Access Statistics for this article

Economic Modelling is currently edited by S. Hall and P. Pauly

More articles in Economic Modelling from Elsevier
Bibliographic data for series maintained by Catherine Liu ().

 
Page updated 2024-05-07
Handle: RePEc:eee:ecmode:v:126:y:2023:i:c:s0264999323002511