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Decomposing Service Exports Adjustments Along the Intensive and Extensive Margin at the Firm‐Level
Review of International Economics, 2019, (27), pp.155-183
Using a panel data set of Austrian service exporting firms this paper examines the determinants of service exports at the firm- and destination country level. We implement a random effects Heckman sample selection firm‐level gravity model as well as a fixed effects Poisson model. Expected firm‐level service exports are decomposed into the intensive and extensive margins of adjustment as a response to counterfactual changes. We find market demand to be a key determinant. Results also suggest high service export potentials due to regulatory reform in partner countries within the EU. Adjustments at the extensive margin only play a marginal role. Increases in firm size as well as changes in distance related costs are most effective in developing new export relationships in services.
Keywords:TP_Wettbewerbsfaehigkeit
Research group:Industrial Economics, Innovation and International Competition
Language:English