The Role of Entry Costs and He terogeneous Characteristics of Firms in the Decision to Export: Empirical Evidence from Firm-level Data in Vietnam

Hiep Nguyen and Hiroshi Ohta

No 17, GSICS Working Paper Series from Graduate School of International Cooperation Studies, Kobe University

Abstract: This paper contributes to the examination of factors that affect the decision to export of firms. Using a panel of firm-level data in Vietnam's manufacturing sector, we test for the role of sunk costs and heterogeneous characteristics of firms in determining firms' probability of exporting. Under a framework that controls for unobserved heterogeneity among firms, we find that the sunk entry costs are important factor that makes export status highly persistent in Vietnam. Firm size, firm age and foreign ownership are positively related to export probability of firms, while total factor productivity has no statistically significant effect. Besides, firms with labor-intensive technology, more skilled labors or competitive labor service are more likely to export.

Pages: 35 pages
Date: 2007-09
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:kcs:wpaper:17

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