Factors constraining EU firm competitiveness. The probability of export-market participation.

Agnieszka Pierzak

Abstract


Rapidly expanding literature on the new strand in the new trade theory and empirical research in this area indicate factors which can positively influence export participation of firms. The analysis presented in this study seek to go one step further and concentrates on a verification which barriers met by the European firms are significant constraints to theirs exports with the aim of  ascertaining if problems identified at the microeconomic level may have their roots in macroeconomic situation. Particular attention is devoted to the impact of institutional, financial and labor type of constraints.

Estimation results indicate that the probability of exporting depends on a combination of a wide set of firms’ characteristics, particularly: total factor productivity, size, age, involvement in other forms of international activity, innovativeness and quality of human capital employed. Country-level macroeconomic and institutional conditions are responsible for a considerable part of country specific determinants of firms’ export and, contrary to assessment recorded at the level of a firm, significantly influence participation in the international trade. The constraints perceived by the European entrepreneurs have rather limited direct impact on probability of being exporter,  however they influence negatively firms’ total factor productivity.


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DOI: http://dx.doi.org/10.17451/eko/43/2015/101

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