Global Pandemic Shocks, Foreign Exposure and Firm Productivity: Evidence from Korean Firm-level Data

Alloysius Joko Purwanto, Ridwan Rusli, Hafis Pratama Rendra Graha, Sirichai Koonaphapdeelert, Reza Miftahul Ulum, Citra Endah Nur Setyawati, Nadiya Pranindita and Ryan Wiratama Bhaskara
Additional contact information
Alloysius Joko Purwanto: Economic Research Institute for ASEAN and East Asia (ERIA)
Hafis Pratama Rendra Graha: Bandung Institute of Technology
Sirichai Koonaphapdeelert: Chiang Mai University
Reza Miftahul Ulum: University of Indonesia
Citra Endah Nur Setyawati: Economic Research Institute for ASEAN and East Asia (ERIA)
Nadiya Pranindita: Economic Research Institute for ASEAN and East Asia (ERIA)
Ryan Wiratama Bhaskara: Economic Research Institute for ASEAN and East Asia (ERIA)

No DP-2024-38, Working Papers from Economic Research Institute for ASEAN and East Asia (ERIA)

Abstract: This study analyses the impact of the COVID-19 pandemic on a firm's total factor productivity (TFP) using Korean firm-level data from 2016 to 2021. The study reveals that the pandemic had a heterogeneous impact on firm TFP depending on the firm's operational characteristics, specifically whether the firm is a multinational enterprise (MNE) or a pure exporter (non-MNE). Whilst the pandemic had a more significant negative impact on the TFP of pure exporters than other firms, MNEs were less affected by the pandemic shock than pure exporters. This implies that whilst both firms were exposed to negative demand shocks on a global scale, MNEs were better equipped to handle supply-side uncertainties through international diversification. The study identifies certain characteristics of MNEs that helped buffer the pandemic shock, such as shedding labour, high R&D intensity, and more diversification via foreign subsidiaries. These characteristics enabled MNEs to mitigate the pandemic shock and even increase their TFP during the pandemic.

Keywords: Global Pandemic; COVID-19; firm productivity; resource allocation; labour shedding; R&D; MNEs; international diversification; pure exporting firms (search for similar items in EconPapers)
JEL-codes: D24 F23 F40 H12 I18 (search for similar items in EconPapers)
Date: 2025-03-04
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.eria.org/uploads/Global-Pandemic-Shock ... irm-Productivity.pdf (application/pdf)

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:era:wpaper:dp-2024-38

Access Statistics for this paper

More papers in Working Papers from Economic Research Institute for ASEAN and East Asia (ERIA) Contact information at EDIRC.
Bibliographic data for series maintained by Ranti Amelia ( this e-mail address is bad, please contact ).