Firm Productivity and Exports: Evidence from Ethiopian manufacturing
Abstract
This paper examines the causal relationship between exporting and productivity using a ten years long plant-level panel data set from an annual census of Ethiopian manufacturing, rarely available in the sub-Saharan Africa. We exploited its length to trace the trajectory of TFP and other productivity measures of groups of firms classified by their export history. We then tested learning-by-exporting using a one-step system-GMM approach with the export-status included directly in the production function. We addressed potential endogeneity problems by using instrumental variables, and also applied a matching analysis to address potential selection bias. We found strong evidence of not only self-selection but also learning-by-exporting. Depending on the specification previous exporting appears to have shifted the production function by 15-32 %. Exporters had on average three times more employees, and paid 1.6 times higher average wage than those of non-exporters.
University
University of Gothenburg. School of Business, Economics and Law
Institution
Department of Economics
Collections
View/ Open
Date
2008-04-30Author
Bigsten, Arne
Gebreeyesus, Mulu
Keywords
Productivity
exports
Ethiopia
manufacturing
Publication type
report
ISSN
1403-2465
Series/Report no.
Working Papers in Economics
303
Language
eng