IDEAS home Printed from https://ideas.repec.org/p/erg/wpaper/1078.html
   My bibliography  Save this paper

Export Concentration and Competition: Does the Firms Type Matter?

Author

Listed:
  • Aya Ahmed
  • Chahir Zaki

    (Cairo University)

Abstract

Trade liberalization enhances the competition in the market as it increases the quality and the quantity of the products available to domestic buyers. This paper contributes to the literature in two ways. First, using Egyptian firm level data, it attempts to examine how export market concentration is affected by competition at the destination market and how firms adjust their product scope following periods of trade openness. Second, we disentangle this effect by the size of exporter to see how small and large firms adjust their trade in response to a fiercer competition. Our findings show that the market potential exerts a positive and significant impact on the concentration index showing that tougher competition in an export market induces a firm to skew its export sales towards its best performing products. Market potential does matter more for small exporters rather than large ones as it helps them become more specialized.

Suggested Citation

  • Aya Ahmed & Chahir Zaki, 2017. "Export Concentration and Competition: Does the Firms Type Matter?," Working Papers 1078, Economic Research Forum, revised 04 Jun 2017.
  • Handle: RePEc:erg:wpaper:1078
    as

    Download full text from publisher

    File URL: http://erf.org.eg/wp-content/uploads/2017/04/1078.pdf
    Download Restriction: no

    File URL: http://bit.ly/2p4vEx4
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Cadot, Olivier & Iacovone, Leonardo & Pierola, Martha Denisse & Rauch, Ferdinand, 2013. "Success and failure of African exporters," Journal of Development Economics, Elsevier, vol. 101(C), pages 284-296.
    2. Marc J. Melitz & Giancarlo I. P. Ottaviano, 2021. "Market Size, Trade, and Productivity," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 4, pages 87-108, World Scientific Publishing Co. Pte. Ltd..
    3. Chen, Natalie & Imbs, Jean & Scott, Andrew, 2009. "The dynamics of trade and competition," Journal of International Economics, Elsevier, vol. 77(1), pages 50-62, February.
    4. Redding, Stephen & Venables, Anthony J., 2004. "Economic geography and international inequality," Journal of International Economics, Elsevier, vol. 62(1), pages 53-82, January.
    5. Carsten Eckel & J. Peter Neary, 2010. "Multi-Product Firms and Flexible Manufacturing in the Global Economy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 77(1), pages 188-217.
    6. Thierry Mayer & Gianmarco Ottaviano, 2008. "The Happy Few: The Internationalisation of European Firms," Intereconomics: Review of European Economic Policy, Springer;ZBW - Leibniz Information Centre for Economics;Centre for European Policy Studies (CEPS), vol. 43(3), pages 135-148, May.
    7. Lionel Fontagné & Angelo Secchi & Chiara Tomasi, 2016. "The Fickle Fringe and the Stable Core: Exporters' Product Mix Across Markets," Working Papers hal-01315601, HAL.
    8. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
    9. Rana Hendy & Chahir Zaki, 2014. "Trade Facilitation and Firms Exports: The Case of Egypt," Working Papers 843, Economic Research Forum, revised Oct 2014.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Federico J. Diez & Jesse Mora & Alan C. Spearot, 2016. "Firms in international trade," Working Papers 16-25, Federal Reserve Bank of Boston.
    2. Melitz, Marc J. & Redding, Stephen J., 2014. "Heterogeneous Firms and Trade," Handbook of International Economics, in: Gopinath, G. & Helpman, . & Rogoff, K. (ed.), Handbook of International Economics, edition 1, volume 4, chapter 0, pages 1-54, Elsevier.
    3. (ed.), 0. "Research Handbook on Economic Diplomacy," Books, Edward Elgar Publishing, number 16053.
    4. repec:hal:pseose:hal-00975562 is not listed on IDEAS
    5. Head, Keith & Mayer, Thierry, 2014. "Gravity Equations: Workhorse,Toolkit, and Cookbook," Handbook of International Economics, in: Gopinath, G. & Helpman, . & Rogoff, K. (ed.), Handbook of International Economics, edition 1, volume 4, chapter 0, pages 131-195, Elsevier.
    6. Gregory Corcos & Massimo Del Gatto & Giordano Mion & Gianmarco I.P. Ottaviano, 2012. "Productivity and Firm Selection: Quantifying the ‘New’ Gains from Trade," Economic Journal, Royal Economic Society, vol. 122(561), pages 754-798, June.
    7. Olivier Cadot & Céline Carrère & Vanessa Strauss-Kahn, 2013. "Trade Diversification, Income, And Growth: What Do We Know?," Journal of Economic Surveys, Wiley Blackwell, vol. 27(4), pages 790-812, September.
    8. Thierry Mayer & Marc J. Melitz & Gianmarco I. P. Ottaviano, 2021. "Market Size, Competition, and the Product Mix of Exporters," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 5, pages 109-150, World Scientific Publishing Co. Pte. Ltd..
    9. repec:spo:wpecon:info:hdl:2441/c8dmi8nm4pdjkuc9g8m210prh is not listed on IDEAS
    10. Carballo, Jeronimo & Ottaviano, Gianmarco I.P. & Volpe Martincus, Christian, 2018. "The buyer margins of firms' exports," Journal of International Economics, Elsevier, vol. 112(C), pages 33-49.
    11. Okubo, Toshihiro & Picard, Pierre M. & Thisse, Jacques-François, 2010. "The spatial selection of heterogeneous firms," Journal of International Economics, Elsevier, vol. 82(2), pages 230-237, November.
    12. Andrew B. Bernard & J. Bradford Jensen & Stephen J. Redding & Peter K. Schott, 2012. "The Empirics of Firm Heterogeneity and International Trade," Annual Review of Economics, Annual Reviews, vol. 4(1), pages 283-313, July.
    13. Harach, Monika & Rodriguez-Crespo, Ernesto, 2014. "Foreign direct investment and trade: A bi-directional gravity approach," Kiel Advanced Studies Working Papers 467, Kiel Institute for the World Economy (IfW Kiel).
    14. Koen Breemersch, 2016. "Competition and product mix adjustment of multi-product exporters : Evidence from Belgium," Working Paper Research 298, National Bank of Belgium.
    15. repec:spo:wpmain:info:hdl:2441/c8dmi8nm4pdjkuc9g8m210prh is not listed on IDEAS
    16. Matthieu Crozet & Lionel Fontagné, 2010. "L'internationalisation des entreprises : une analyse microéconomique de la mondialisation," Économie et Statistique, Programme National Persée, vol. 435(1), pages 3-12.
    17. Iacovone, Leonardo & Rauch, Ferdinand & Winters, L. Alan, 2013. "Trade as an engine of creative destruction: Mexican experience with Chinese competition," Journal of International Economics, Elsevier, vol. 89(2), pages 379-392.
    18. repec:hal:spmain:info:hdl:2441/dambferfb7dfprc9m01g1j1k2 is not listed on IDEAS
    19. Jabbour, Liza & Tao, Zhigang & Vanino, Enrico & Zhang, Yan, 2019. "The good, the bad and the ugly: Chinese imports, European Union anti-dumping measures and firm performance," Journal of International Economics, Elsevier, vol. 117(C), pages 1-20.
    20. Jaan Masso & Priit Vahter, 2012. "The Role Of Product Level Entry And Exit In Export And Productivity Growth: Evidence From Estonia," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 86, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    21. Parenti, Mathieu, 2018. "Large and small firms in a global market: David vs. Goliath," Journal of International Economics, Elsevier, vol. 110(C), pages 103-118.
    22. Thierry Mayer & Marc J. Melitz & Gianmarco I. P. Ottaviano, 2021. "Market Size, Competition, and the Product Mix of Exporters," World Scientific Book Chapters, in: Firms and Workers in a Globalized World Larger Markets, Tougher Competition, chapter 5, pages 109-150, World Scientific Publishing Co. Pte. Ltd..
    23. Colacicco, Rudy, 2012. "The "Average" Within-Sector Firm Heterogeneity in General Oligopolistic Equilibrium," MPRA Paper 40212, University Library of Munich, Germany.
    24. Zajc Kejžar, Katja, 2016. "Shutdown versus M&A: An empirical investigation of Slovenian incumbent firms’ responses to foreign competition," Economic Systems, Elsevier, vol. 40(2), pages 247-259.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:erg:wpaper:1078. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sherine Ghoneim (email available below). General contact details of provider: https://edirc.repec.org/data/erfaceg.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.