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Foreign Ownership and the Extensive Margins of Exports: Evidence for Manufacturing Enterprises in Germany

Horst Raff () and Joachim Wagner ()

No 317, Working Paper Series in Economics and Institutions of Innovation from Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies

Abstract: We examine how foreign ownership of a firm affects the variety of goods that the firm exports and the number of countries it trades with. We construct a simple theoretical model of how foreign ownership may affect these extensive margins of exports and take this model to data from Germany, one of the leading actors on the world market for goods. In line with theoretical predictions we find that foreign-owned firms do export more goods to more countries after controlling for firm size, productivity and industry affiliation. These differences between foreign-owned firms and domestically controlled firms are highly statistically significant, and they are large from an economic point of view, with foreign-owned firms exporting up to 39% more goods to up to 31% more countries.

Keywords: International trade; foreign ownership; multinational enterprise; foreign direct investment; extensive margins of exports; Germany (search for similar items in EconPapers)
JEL-codes: F14 F23 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2013-06-12
New Economics Papers: this item is included in nep-bec and nep-int
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Related works:
Journal Article: Foreign Ownership and the Extensive Margins of Exports: Evidence for Manufacturing Enterprises in Germany (2014) Downloads
Working Paper: Foreign Ownership and the Extensive Margins of Exports: Evidence for Manufacturing Enterprises in Germany (2013) Downloads
Working Paper: Foreign ownership and the extensive margins of exports: Evidence for manufacturing enterprises in Germany (2013) Downloads
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