Exporting behavior of foreign affiliates: Theory and evidence

Jiangyong Lu, Yi Lu and Zhigang Tao

Journal of International Economics, 2010, vol. 81, issue 2, 197-205

Abstract: Firms have increasingly conducted different stages of production in different countries. In particular, they may set up operations in low-cost countries (those operations are referred to as foreign affiliates in those countries) either as platforms for export or serving the growing markets there. What is the exporting behavior of foreign affiliates? In this paper, using data from China, we find that among foreign affiliates exporters are less productive than non-exporters. We then offer a theoretical explanation by incorporating into the standard firm heterogeneity model the possibility that firms could have different stages of production in different countries.

Keywords: Foreign; affiliates; Exporting; behavior; Firm; heterogeneity (search for similar items in EconPapers)
Date: 2010
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Citations: View citations in EconPapers (65)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:81:y:2010:i:2:p:197-205

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