Export characteristics and output volatility: comparative firm-level evidence for CEE countries

Bogdan Chiriacescu, Tibor Lalinsky, Urška Čede, Jaanika Meriküll and Péter Harasztosi

No 1902, Working Paper Series from European Central Bank

Abstract: The literature shows that openness to trade improves long-term growth but also that it may increase exposure to high output volatility. In this vein, our paper investigates whether exporting and export diversification at the firm level have an effect on the output volatility of firms. We use large representative firm-level databases from Estonia, Hungary, Romania, Slovakia and Slovenia over the last boom-bust cycle in 2004-2012. The results confirm that exporting is related to higher volatility at the firm level. There is also evidence that this effect increased during the Great Recession due to the large negative shocks in export markets. In contrast to the literature and empirical findings for large or advanced countries we do not find a statistically significant and consistent mitigating effect from export diversification in the Central and Eastern European countries. In addition, exporting more products or serving more markets does not necessarily result in higher stability of firm sales. JEL Classification: F14, F43, O57

Keywords: business cycle; CEE; Central and Eastern Europe; export diversification; export share; volatility of sales (search for similar items in EconPapers)
Date: 2016-05
New Economics Papers: this item is included in nep-bec, nep-int and nep-tra
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Export characteristics and output volatility: comparative firm-level evidence for CEE countries (2018)
Working Paper: Export characteristics and output volatility: comparative firm-level evidence for CEE countries (2016)
Working Paper: Export characteristics and output volatility: comparative firm-level evidence for CEE countries (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:ecb:ecbwps:20161902

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