The theoretical determinants of firm size and the firm size-exporting relationship among developing nations.
Date
2011-04-28
Authors
Anjinho, Nicolas
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Abstract
What factors determine the decision of a firm to participate in the export market? This paper
looks into the firm level determinants of both size and international trade. A more
comprehensive understanding of the forces behind the firm size-exporting relationship is
developed. The relationship between firm size and exporting is tested using a cross-country
dataset of developing countries to determine the extent of country specific influences on
international trade. These theoretical considerations and cross country tests indicate a
positive, significant relation between exporting and firm size. This relation is robust across all
countries tested and stands up to all the robustness checks examined in this paper. Regional or
country specific indicators affect the level of the relationship, but not its nature.