Firm Size as a Determinant of Export Propensity: An Empirical Study of South Carolina Firms
Bibliographic record
Abstract
INTRODUCTIONExporting by small firms is a considerably significant economic activity. Research conducted by the U.S. Bureau of Census indicates that over two hundred thousand small firms exported goods in 2001. Small companies account for 89 percent of all U.S. exporters, a percentage that has only varied slightly since 1995. Small exporters exported goods valued at $129 billion which represented 20.8 percent of total U.S. goods exported (U.S. Census Bureau, 2003). The literature continues to research international entry among small firms, including the relationship between firm size and exporting (Wolffand Pett, 2000 and Mittelstaedt, Harben, and Ward, 2003). Mittelstaedt, Harben, and Ward (2003) argue that firms with fewer than 20 employees fall below a critical threshold and will face major obstacles should they attempt to export. Their conclusions contrast with Wolffand Pett (2000) who argue that micro firms are capable of exporting.The purpose of this paper is to evaluate the export propensity of firms in an empirical study to overcome the competing theories espoused by Mittlelstaedt, et al (203) and Wolffand Pett (2000). We use a data set similar to that of Mittelstaedt, et al (2003), but analyze the dataset differently. Although we find that firm size has a significant impact on export propensity, we fail to find a threshold at twenty employees. Thus our findings support Wolffand Pett's (2000) arguments that small firms are fully capable of exporting which contrasts with the findings of Mittelstaedt et al (2003). Our conclusions indicate that researchers have not yet fully understood the relationship between firm size and exporting behavior.In the next section, we provide a brief review of the literature on exporting by small firms with a particular emphasis on size as a determinant of exporting ability. Then, we describe our research design and discuss our results using a sample of firms obtained from a database of over three thousand firms maintained by the South Carolina Department of Commerce. In the final section, we conclude our discussion.LITERATURE REVIEWSmall firms have emerged as one of the most widely researched topics in the last 30 years (Wright, 1993; Autio, Sapienza, Almeida, 2000; Baird, Lyles, and Orris, 1994; Aitken, Hanson, and Harrison, 1997; and Oviatt and McDougall, 1995). Rather than attempt an exhaustive review of past research, this section will emphasize particular research relevant to firm size as a determinant of exporting. We realize that other forms of market entry are available to small firms, but exporting remains the most attractive means of foreign market entry (Pett and Wolff, 2003; Hollenstein, 2003).Numerous studies have found a positive relationship between firm size and internationalization. For example, Baird, Lyles, and Orris (1994) found that international firms are larger and tend to be industrial firms rather than retail or service firms. Dhanaraj and Beamish (2003) confirmed this finding using a resource-base theory of the firm (Penrose, 1959; Barney, 1991) in a sample of Canadian firms.Other studies have measured performance outcomes in terms of export performance or export intensity. Yet, the findings appear to be mixed. Some studies identify a positive relationship between firm size and export success (e.g., Lali and Kumar, 1981; Kaynak and Kothari, 1984). Other studies find no relationship (e.g., Czinkota and Johnson, 1983; and Moini, 1995). Finally, another group of studies finds an inverse relationship (e.g., Cooper and Klienschmidt, 1985).Recent research also provides contradictory evidence about the relationship between firm size and export activity. Wolff and Pett (2000) demonstrate that small firms are capable of exporting. They conclude that small firms use a different decision process to export than do large firms. They argue that the resource-based view of the firm may serve as a useful explanation for the success of these small exporters. …
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Teacher imitationNot calibrated prevalence, not ground truth. Human validation pending. Learned from the 10,348 direct Codex labels and 10,348 direct Gemma labels. Candidate is the union of thresholded teacher heads; consensus is their intersection. These outputs are machine_predicted_unvalidated and are not human labels or direct frontier model labels.
Codex and Gemma teacher scores by category
| Category | Codex | Gemma |
|---|---|---|
| Metaresearch | 0.000 | 0.000 |
| Meta-epidemiology (narrow) | 0.000 | 0.000 |
| Meta-epidemiology (broad) | 0.001 | 0.000 |
| Bibliometrics | 0.000 | 0.000 |
| Science and technology studies | 0.000 | 0.000 |
| Scholarly communication | 0.000 | 0.000 |
| Open science | 0.001 | 0.000 |
| Research integrity | 0.000 | 0.000 |
| Insufficient payload (model declined to judge) | 0.000 | 0.000 |
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Baseline scores from an immature model (maturity gate not passed, 7 training rounds). Scores rank; they never assert a category.
score_only:v0-immature-baseline · verbatim from the scoring run: score_only means the number may rank works, and no category label ships from itClassification
machine, unvalidatedMachine predicted; a candidate call from one teacher head, not a consensus.
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