Productivity, agglomeration, and exporting directly: evidence from the Chinese textile industry

Andrew Cassey and Qianqian Wang

The Journal of International Trade & Economic Development, 2022, vol. 31, issue 8, 1149-1172

Abstract: This paper estimates the effect of total factor productivity (TFP) and agglomeration on the choice of a firm to export directly or indirectly through an intermediary. Using Chinese firm-level textile industry data, we apply a spatial autoregressive probit model. We find agglomeration is several times more important than productivity for a firm choosing to export directly. The marginal effect of agglomeration, however, is decreasing as the number of neighbors increases beyond 10.

Date: 2022
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DOI: 10.1080/09638199.2022.2064901

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