The direction of causality between exports and firm performance: microeconomic evidence from Croatia using the matching approach

This paper contributes to the literature by using propensity score matching to test for causal effects of starting to export on firm performance in Croatian manufacturing firm-level data. The results confirm that exporters have characteristics superior to those of non-exporters. In the main sample s...

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Bibliographic Details
Published inPublic sector economics Vol. 39; no. 1; p. 1
Main Authors Valdec, Miljana, Zrnc, Jurica
Format Journal Article
LanguageEnglish
Published Zagreb Institute of Public Finance 01.01.2015
Subjects
Business metrics
Causality
Costs
Data models
Exports
Hypotheses
International trade
Investigations
Manufacturing
Market entry
Organizational learning
Productivity
Studies
Croatia
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Summary:This paper contributes to the literature by using propensity score matching to test for causal effects of starting to export on firm performance in Croatian manufacturing firm-level data. The results confirm that exporters have characteristics superior to those of non-exporters. In the main sample specification there is pervasive evidence of self-selection into export markets, meaning that firms are successful years before they become exporters. Using multiple firm performance indicators, panel and cross section data models together with various sample specifications there is scant evidence on learning-by-exporting which holds true only in a few cases. On the other hand, higher sales growth is found to be a more conclusive distinguishing characteristic of new exporters. As in similar studies, we find that a part of the results depends on the number of export starters in the estimation sample.
ISSN:2459-8860