TY - CHAP

T1 - The exporter productivity premium along the productivity distribution

T2 - Evidence from quantile regression with nonadditive firm fixed effects

AU - Powell, David

AU - Wagner, Joachim

PY - 2021/2/25

Y1 - 2021/2/25

N2 - A vast literature on the international activities of heterogeneous firms finds the existence of a positive exporter productivity premium. On average, exporting firms are more productive than firms that sell on the national market only. The Melitz [2003] model, however, has implications for not only mean differences but also differences in the distribution of productivity. Furthermore, exporting firms may be different from non-exporting firms for reasons that are not included in the Melitz model. We believe that conditioning on firm fixed effects and studying the distribution of productivity are both necessary for empirical tests of the Melitz model. This paper is the first to introduce such a method by employing a new quantile estimation technique for panel data introduced in Powell [2013]. We find that the premium is positive at all productivity levels, but highest at the lowest quantiles. These results support theoretical models which suggest that there is a division in productivity between exporters and non-exporters.

AB - A vast literature on the international activities of heterogeneous firms finds the existence of a positive exporter productivity premium. On average, exporting firms are more productive than firms that sell on the national market only. The Melitz [2003] model, however, has implications for not only mean differences but also differences in the distribution of productivity. Furthermore, exporting firms may be different from non-exporting firms for reasons that are not included in the Melitz model. We believe that conditioning on firm fixed effects and studying the distribution of productivity are both necessary for empirical tests of the Melitz model. This paper is the first to introduce such a method by employing a new quantile estimation technique for panel data introduced in Powell [2013]. We find that the premium is positive at all productivity levels, but highest at the lowest quantiles. These results support theoretical models which suggest that there is a division in productivity between exporters and non-exporters.

KW - Exporter productivity premium

KW - Panel data

KW - Quantile treatment effects

KW - Economics

UR - http://www.scopus.com/inward/record.url?scp=85109732488&partnerID=8YFLogxK

UR - https://www.mendeley.com/catalogue/2b44241c-e921-3ed3-97c8-d1d726c3cfea/

U2 - 10.1142/9781786349699_0009

DO - 10.1142/9781786349699_0009

M3 - Chapter

AN - SCOPUS:85109732488

SN - 9781786349682

SP - 121

EP - 149

BT - Microeconometric Studies Of Firms Imports And Exports

A2 - Wagner, Joachim

PB - World Scientific Publishing Co.

ER -