TY - JOUR

T1 - A Note on the Firm Size - Export Relationship

AU - Wagner, Joachim

N1 - Funding Information: This paper uses data from the Hannover Firm Panel project financially supported by the Volkswagen Foundation. I thank Robert Kieschnick for helpful discussions on modelling a percentage variable with many limit observations and for his code to estimate regressions based on the beta distribution, Pravin K. Trivedi for

PY - 2001

Y1 - 2001

N2 - The positive relationship between firm size and direct exports is often considered as a stylized fact. Numerous econometric investigations back theoretical considerations by showing that a ceteris paribus positive relationship between firm size and direct export activities exists. This note contributes to the literature by closely looking at an econometric modelling issues that has largely been neglected hitherto. Various approaches used in the literature to model the exports/sales ratio, which is a percentage variable with usually many observations at the lower limit, are discussed. It is argued that all these methods are seriously flawed, and an alternative approach is suggested that is applied using data from a large comprehensive recent survey of German manufacturing establishments. Furthermore, the relation between firm size and exports is examined in four selected industries to test whether the importance of economies of scale and transaction cost efficiencies vary considerably between industries.

AB - The positive relationship between firm size and direct exports is often considered as a stylized fact. Numerous econometric investigations back theoretical considerations by showing that a ceteris paribus positive relationship between firm size and direct export activities exists. This note contributes to the literature by closely looking at an econometric modelling issues that has largely been neglected hitherto. Various approaches used in the literature to model the exports/sales ratio, which is a percentage variable with usually many observations at the lower limit, are discussed. It is argued that all these methods are seriously flawed, and an alternative approach is suggested that is applied using data from a large comprehensive recent survey of German manufacturing establishments. Furthermore, the relation between firm size and exports is examined in four selected industries to test whether the importance of economies of scale and transaction cost efficiencies vary considerably between industries.

KW - Economics

KW - Unternehmensgröße

KW - Export

UR - http://www.scopus.com/inward/record.url?scp=0035623448&partnerID=8YFLogxK

U2 - 10.1023/A:1012202405889

DO - 10.1023/A:1012202405889

M3 - Journal articles

VL - 17

SP - 229

EP - 237

JO - Small Business Economics

JF - Small Business Economics

SN - 0921-898X

IS - 4

ER -