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Article
Publication date: 4 March 2019

David Córcoles, Carmen Díaz-Mora and Rosario Gandoy

Focusing on the global trade collapse and the subsequent recovery period, the purpose of this paper is to examine the export performance of firms that are involved in…

Abstract

Purpose

Focusing on the global trade collapse and the subsequent recovery period, the purpose of this paper is to examine the export performance of firms that are involved in complex internationalization strategies.

Design/methodology/approach

The authors use a random-effects probit model with panel data and a dynamic panel data model (GMM system) for Spanish manufacturing firms from 2006 to 2013 period.

Findings

It is found that, once firm characteristics are controlled for, complex internationalization plays an important role in continuing to export and, additionally, positively influences the level of exports. Firms active in a complex mix of internationalization strategies have an added advantage, which enables them to confront the uncertainty of foreign markets in better conditions and translates to a lower likelihood of ceasing exporting and to higher export values.

Practical implications

The present paper throws light on this question by showing that the negative impact of trade collapse in 2009 on the export level was lower for firms inserted in complex internationalization strategies and the subsequent recovery was more intense.

Originality/value

The analysis goes one step further and investigates whether the impact is different during the trade collapse in 2009 and the following recovery. Here, previous empirical research at firm level on the role of complex internationalization strategies in trade is contradictory.

Details

Journal of Economic Studies, vol. 46 no. 2
Type: Research Article
ISSN: 0144-3585

Keywords

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Article
Publication date: 13 August 2018

Carmen Díaz-Mora, Rosario Gandoy and Belen Gonzalez-Diaz

Drawing on the literature that has shown the prevalence of short-lived trade relationships, the purpose of this paper is to provide further understanding about this issue…

Abstract

Purpose

Drawing on the literature that has shown the prevalence of short-lived trade relationships, the purpose of this paper is to provide further understanding about this issue by exploring the impact of engaging in Global Value Chains (GVCs) on the chance of export survival at product-country level, paying special attention to the differences between advanced and developing countries. The authors also investigate whether the type of GVC participation (backward or forward) matters for export survival.

Design/methodology/approach

To capture to what extent a country’s exports are integrated in GVCs, the authors use the OECD Inter-Country Input-Output database to estimate value added incorporated in exports. Through the estimation of a discrete-time duration model, the authors explore the impact of engaging in GVCs on export survival using highly disaggregated trade data from the CEPII’s BACI database.

Findings

The findings endorse the hypothesis that deeper participation in GVCs is a key factor in explaining stability in trade relationships, mainly for developing countries where the trade flows are especially fragile. The authors also find different effects depending on the type of GVC involvement and on whether the value chain partners are advanced or developing.

Originality/value

The paper contributes to the literature by extending the understanding on the factors that promote the stability of exports, including among them, involvement on GVCs (and its forms) which is one of the most relevant factors to explain recent behavior of trade.

Details

Journal of Economic Studies, vol. 45 no. 3
Type: Research Article
ISSN: 0144-3585

Keywords

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