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Exporting by Latvian companies: vitality, drivers of success, and challenges

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  • Talis J. Putninš

    (Department of Economics, Stockholm School of Economics in Riga and UTS Business School, University of Technology, Sydney)

Abstract

This paper sheds light on Latvian exporters – how active they are, what challenges they face, what makes them succeed or fail. Our study draws on a survey of 503 medium-sized Latvian companies. We find that most medium-sized Latvian companies are exporters (either directly or indirectly) and for a typical exporting company, export turnover constitutes more than half of its total turnover. Exporting companies tend to be larger, younger and faster growing than their non-exporting counterparts. They pay higher average wages, consistent with the notion that they have higher labour productivity or utilise more skilled labour on average. For a typical company, export activity has been stable over the past five years, with zero growth in export turnover and an average increase of one additional export destination; however, there is wide dispersion in export growth and success among exporting companies. Successful exporters tend to be larger, with higher productivity growth and greater innovativeness, proactiveness and risk taking, i.e., stronger entrepreneurial orientation. The main obstacle preventing non-exporters from commencing exporting is lack of international competitiveness. This is also the main reason why companies discontinue exporting, and should be the focus of policy aimed at promoting exporting.

Suggested Citation

  • Talis J. Putninš, 2013. "Exporting by Latvian companies: vitality, drivers of success, and challenges," Baltic Journal of Economics, Baltic International Centre for Economic Policy Studies, vol. 13(2), pages 3-33, December.
    • Handle: RePEc:bic:journl:v:13:y:2013:i:2:p:3-33
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    File URL: https://www.tandfonline.com/doi/epdf/10.1080/1406099X.2013.10840531
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    References listed on IDEAS

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    1. Andreas Rauch & Johan Wiklund & G.T. Lumpkin & Michael Frese, 2009. "Entrepreneurial Orientation and Business Performance: An Assessment of past Research and Suggestions for the Future," Entrepreneurship Theory and Practice, , vol. 33(3), pages 761-787, May.
    2. Konstantīns Beņkovskis, 2012. "Competitiveness of Latvia's exporters," Baltic Journal of Economics, Baltic International Centre for Economic Policy Studies, vol. 12(2), pages 17-45, December.
    3. International Monetary Fund, 2009. "Decoupling from the East Toward the West? Analyses of Spillovers to the Baltic Countries," IMF Working Papers 2009/125, International Monetary Fund.
    4. Claus-Friedrich Laaser & Klaus Schrader, 2005. "Baltic Trade with Europe: Back to the Roots?," Baltic Journal of Economics, Baltic International Centre for Economic Policy Studies, vol. 5(2), pages 15-37, July.
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    Citations

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    Cited by:

    1. Andrej Cieslik & Anna Michalek & Jan Jakub Michalek & Jerzy Mycielski, 2015. "Determinants of Export Performance: Comparison of Central European and Baltic Firms," Czech Journal of Economics and Finance (Finance a uver), Charles University Prague, Faculty of Social Sciences, vol. 65(3), pages 211-229, May.
    2. Majed Barjas G. Alotaibi & Yabin Zhang, 2017. "The relationship between export market orientation and export performance: an empirical study," Applied Economics, Taylor & Francis Journals, vol. 49(23), pages 2253-2258, May.
    3. Andrzej Cieślik & Jan Michałek & Anna Michałek, 2014. "The Influence of Firm Characteristics and Export Performance in Central and Eastern Europe: Comparisons of Visegrad, Baltic and Caucasus States," Entrepreneurial Business and Economics Review, Centre for Strategic and International Entrepreneurship at the Cracow University of Economics., vol. 2(1), pages 7-18.
    4. Éltető, Andrea & Udvari, Beáta, 2018. "Nemzetköziesedés a válság után - a magyar kis- és középvállalatok exportjára ható tényezők [Internationalisation since the crisis - factors affecting exports by small and medium-sized Hungarian ent," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(4), pages 402-425.
    5. Marija Krūmiņa & Anders Paalzow, 2017. "The Business Cycle and Early-Stage Entrepreneurship in Latvia," Societies and Political Orders in Transition, in: Arnis Sauka & Alexander Chepurenko (ed.), Entrepreneurship in Transition Economies, pages 135-152, Springer.
    6. Andrea Éltető, 2019. "Export of SMEs after the Crisis in Three European Peripheral Regions – a Literature Review," Society and Economy, Akadémiai Kiadó, Hungary, vol. 41(1), pages 3-26, March.

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    More about this item

    Keywords

    exports; Latvia; competitiveness; productivity; growth; entrepreneurial orientation;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance

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