Higher Productivity in Importing German Manufacturing Firms: Self-Selection, Learning from Importing, or Both?

42 Pages Posted: 1 Dec 2008

See all articles by Alexander Vogel

Alexander Vogel

Leuphana University of Lueneburg

Joachim Wagner

University of Lueneburg - Institute of Economics; Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Economics; IZA Institute of Labor Economics

Abstract

This paper uses a newly available comprehensive panel data set for manufacturing enterprises from 2001 to 2005 to document the first empirical results on the relationship between imports and productivity for Germany, a leading actor on the world market for goods. Furthermore, for the first time the direction of causality in this relationship is investigated systematically by testing for self-selection of more productive firms into importing, and for productivity-enhancing effects of imports ('learning-by-importing'). We find a positive link between importing and productivity. From an empirical model with fixed enterprise effects that controls for firm size, industry, and unobservable firm heterogeneity we see that the premia for trading internationally are about the same in West and East Germany. Compared to firms that do not trade at all two-way traders do have the highest premia, followed by firms that only export, while firms that only import have the smallest estimated premia. We find evidence for a positive impact of productivity on importing, pointing to self-selection of more productive enterprises into imports, but no evidence for positive effects of importing on productivity due to learning-by-importing.

Keywords: imports, exports, productivity, enterprise panel data, Germany

JEL Classification: F14, D21

Suggested Citation

Vogel, Alexander and Wagner, Joachim, Higher Productivity in Importing German Manufacturing Firms: Self-Selection, Learning from Importing, or Both?. IZA Discussion Paper No. 3854, Available at SSRN: https://ssrn.com/abstract=1309096 or http://dx.doi.org/10.1111/j.0042-7092.2007.00700.x

Alexander Vogel

Leuphana University of Lueneburg ( email )

Scharnhorststra├če 1
Wilschenbrucher Weg 69
L├╝neburg, 21335
Germany

Joachim Wagner

University of Lueneburg - Institute of Economics ( email )

PO Box 2440
D-21314 Luneburg
Germany
+49 4131 677 2330 (Phone)
+49 4131 677 2026 (Fax)

HOME PAGE: http://www.uni-lueneburg.de/wifo

Max Planck Society for the Advancement of the Sciences - Max Planck Institute for Economics ( email )

Kahlaische Strasse 10
D-07745 Jena, 07745
Germany

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
62
Abstract Views
845
rank
420,569
PlumX Metrics