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Bundling and exporting: evidence from German SMEs

Tommaso Aquilante () and Ferran Vendrell-Herrero ()
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Ferran Vendrell-Herrero: University of Birmingham

No 781, Bank of England working papers from Bank of England

Abstract: This paper studies the effect of bundling products and services on the export performance of firms. Using a unique sample, we document several facts about German small and medium enterprises (SMEs). First, bundling is a relatively rare activity, which is unevenly spread across sectors. Second, SMEs that bundle products and services are more productive than those selling products and services separately. Third, these firms tend to be more internationally oriented. While most of the existing literature focuses on large firms, we contribute to the literature by uncovering a robust positive relation between product-service bundling and exporting in SMEs. Importantly, the competitiveness-enhancing effect of bundling goes beyond manufacturing, affecting non-manufacturing firms also. To mitigate endogeneity concerns, we exploit the panel structure of the data and implement several (doubly robust) propensity score matching techniques.

Keywords: Bundling; innovation; export; SMEs (search for similar items in EconPapers)
JEL-codes: D22 F10 F14 F23 L80 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cse, nep-ent, nep-eur, nep-ind, nep-int and nep-sbm
Date: 2019-03-01
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Persistent link: https://EconPapers.repec.org/RePEc:boe:boeewp:0781

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