Active on Many Foreign Markets: A Portrait of German Multi-market Exporters and Importers from Manufacturing Industries

Abstract

This paper uses information on more than 160 million export and import transactions by German firms from 2009 to 2012 to document the decisive role of multi-market traders that are active on many foreign markets, where a market is defined as a combination of a good traded and a country traded with. Using merged information from trade transactions and from surveys conducted by the statistical offices it is shown that, controlling for detailed industry affiliation, the number of foreign markets a firm from manufacturing industries is active on as an exporter or importer is higher in firms that are larger, older and foreign owned and that have higher labor productivity, human capital intensity and R&D intensity. With the exception of labor productivity these results are valid ceteris paribus, too. All these results from a descriptive empirical investigation are in line with hypotheses that are derived from the literature on the links between firm characteristics and the extensive margins of foreign trade.

Export Scope and Characteristics of Destination Countries: Evidence from German Transaction Data

“…Firms from the top one percent of the distribution of the number of markets export to more than 1,000 different markets, where exporters with the very largest number of markets served cover many thousand export markets. Multi-market exporters play a decisive role for exports as a whole -the share of exporters with the 100 largest numbers of markets is 30 percent of total exports (for details, see Wagner 2018).…”

“…in German firms are positively linked with firm characteristics like size, productivity, human capital intensity, innovativeness, firm age, and foreign ownership (Wagner 2018).…”

The Gender Gap in International Trade: Female-Run Firms and the Exporter Productivity Premium

“…Firms and productivity in Germany. Almost 30 years after German reunification differences in firm performance still exist between the West and East of Germany (Wagner, 2012(Wagner, , 2018. Although the East experienced a considerable catch-up in living standards over time, labor productivity is still significantly lagging behind in the East as compared to the West (Burda, 2006(Burda, , 2008Burda and Severgnini 2018;Burda and Hunt 2001).…”

“…With data for more than 160 million export and import transactions over the years from 2009 to 2012, Wagner (2018) shows that in the Germany economy larger, older and foreign owned firms, and firms that have a higher labor productivity as well as research and development and human capital intensity are the firms that are active in a larger number of foreign markets. Most of the firms are active on a few markets, only, but firms that are active on many markets are responsible for a higher share of foreign trade.…”

German Firms in International Trade: Evidence from Recent Microdata

“…Manova and Zhang (2009) analyse similar data for China. 2 Among other topics, Joachim Wagner has used earlier German transaction data to investigate the extensive margins of trade in manufacturing (Wagner, 2018), the short run dynamics of trade (Wagner, 2016b), firm productivity (Wagner, 2012), firm age (Wagner, 2015), innovation activity (Wagner, 2017a), firm profits (Wagner, 2014), the trade impact of the distance to destination countries (Wagner, 2017b), and the lumpiness of trade (Wagner, 2016c). 3 When using the term "transaction", we refer to the sum of exports or imports of a certain product by a certain German firm to or from a certain country within a certain time frame.…”