Internationalization of service SMEs: Evidence from France

18  April 2013    4:00 pm

Harald Oberhofer, University Salzburg

Venue

wiiw, Rahlgasse 3, 1060 Vienna, lecture hall (entrance from the ground floor)

Description

This study empirically investigates the key firm- and industry-specific restrictions to internationalization of service activities. For this purpose, we use firm level data from French firms operating in service industries over the time period 1998 to 2007 and formulate two-part models consisting of (i) (dynamic) export equations and (ii) (dynamic) export share equations. Our main results confirm the view that small service firms are less likely to engage in any export activities. Conditional on exporting, smaller firms, however tend to export larger shares of their overall services. In line with the new-new trade theory our baseline results also indicate that more productive firms serve foreign markets with a higher probability and to a larger extent. Moreover, export decisions are estimated to be extremely persistent implying that scarce export promotion budgets should be directed towards already exporting firms. Finally, our estimates also reveal substantial heterogeneity across different types of services.

Keywords: Export activities, small and medium sized enterprises (SMEs), service industries, new-new trade theory, dynamic export equations

JEL classification: C23, C25, F14, F23, L80, L90


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