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Extensive margins of trade and firm survival

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  • Kao, Erin Hui-Chuan
  • Liu, Jin-Tan

Abstract

Using firm-level transaction data from Taiwan, this study shows that firms that engage in exports alone and import intermediate inputs significantly increase the probability of their survival compared to firms that engage in no external trade. Extending current studies, this study shows that multiproduct and multicountry trading firms are more likely to survive by becoming “leaner and meaner” and trading with a more diverse set of countries.

Suggested Citation

  • Kao, Erin Hui-Chuan & Liu, Jin-Tan, 2022. "Extensive margins of trade and firm survival," Economics Letters, Elsevier, vol. 218(C).
    • Handle: RePEc:eee:ecolet:v:218:y:2022:i:c:s0165176522002464
    DOI: 10.1016/j.econlet.2022.110716
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    References listed on IDEAS

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    4. Joachim Wagner, 2016. "Credit Constraints and Exports: A Survey of Empirical Studies Using Firm Level Data," World Scientific Book Chapters, in: Microeconometrics of International Trade, chapter 12, pages 401-421, World Scientific Publishing Co. Pte. Ltd..
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    Cited by:

    1. Matilde Cappelletti & Leonardo M. Giuffrida & Gabriele Rovigatti, 2022. "Procuring Survival," CESifo Working Paper Series 10124, CESifo.
    2. Cappelletti, Matilde & Giuffrida, Leonardo M., 2021. "Procuring survival," ZEW Discussion Papers 21-093, ZEW - Leibniz Centre for European Economic Research.

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    More about this item

    Keywords

    Exports; Firm survival; Imports; Multicountry; Multiproduct;
    All these keywords.

    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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