Économie et Statistique n° 435-436 - Internationalization of French Business Firms
Economies of Agglomeration in Exports and Difficulties in Market Access
The empirical literature on international trade emphasizes the role of export economies of agglomeration. It shows the positive impact of the presence of other exporters in a firm's French location on the probability that the firm will decide to export to a given country. We explore this finding by studying the nature of such effects as a function of heterogeneous characteristics of exporting firms and variables that measure the difficulty of access to importing countries: time and number of documents needed to import into the destination country, weighted demand, and measurement of economic and total country risk. Our results suggest that the impact of export externalities does not differ significantly according to firms' performance. By contrast, an increase in the number of neighbouring firms exporting to a given country has a greater impact on the probability that a firm will decide to export when that country is hard to access. For example, an additional neighbour exporting a product to a given country increases the probability that a firm will start to export the same product to the same country by 1.95 percentage points when the country has higher-than-average documentation requirements, and by 0.69 points when the paperwork is lighter than average. Our results are robust to various sub-samples and for all our measures of difficulty of access. They suggest that the collective approaches and experience-sharing encouraged by French authorities in recent years are all the more important for firms intent on conquering difficult markets.