Pradhan, Jaya Prakash and Das, Keshab (2012): Exports by Indian Manufacturing SMEs: Regional Patterns and Determinants.
Download (221Kb) | Preview
A unique firm level database was used to shed lights on national and regional patterns of SME export contribution in manufacturing activities. An eclectic conceptual framework for SME export performance was developed based on the reviews of extant theories of international trade, which incorporate firm-, sector-, policy- and region-specific variables. The model was estimated for using the Censored Quantile Regression. SMEs are found to have modest roles in the manufacturing exports from India during 1991–2008 and their exports is mostly dominated by low technology products. Regionally, SME manufacturing exports is heavily concentrated with Southern states alone accounting for half of it during 2000–08, followed by Western India. The export determinant analysis brought to the fore the significance of certain key physical and economic infrastructure for SMEs, particularly access to ports, power, telecommunications and loan finance. Local market conditions, namely the size, growth and per capita income of the host states also favourably affect SME export activities. SMEs are more dependent on foreign technologies for enhancing their exporting rather than in-house R&D. Apart from improving the key business supporting infrastructure, the state policy makers may better enhance export orientation of SMEs by networking them to R&D facilities and providing easier access to information on overseas markets. This is because SMEs are more dependent on foreign technologies for enhancing their exporting rather than in-house R&D. Relatively smaller enterprises need greater support as they are disadvantaged by their size.
|Item Type:||MPRA Paper|
|Original Title:||Exports by Indian Manufacturing SMEs: Regional Patterns and Determinants|
|English Title:||Exports by Indian Manufacturing SMEs: Regional Patterns and Determinants|
|Keywords:||Indian SMEs; Exports|
|Subjects:||L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L11 - Production, Pricing, and Market Structure; Size Distribution of Firms
F - International Economics > F1 - Trade > F10 - General
|Depositing User:||Jaya Prakash Pradhan|
|Date Deposited:||09. Oct 2012 08:36|
|Last Modified:||12. Feb 2013 03:45|
Acs, Z. J., R. Morck, J. M. Shaver, and B. Yeung (1997), ‘The Internationalization of Small and Medium-Sized Enterprises: A Policy Perspective’, Small Business Economics, 9 (1), pp. 7–20.
Anh, N.N., P. Q. Ngoc, N.D. Chu, and N.D. Nhat (2007), ‘Innovation and Export of Vietnam’s SME Sector’, Paper for UNU-MERIT Conference on Micro-Evidence on Innovation in Developing Economies.
Asheim, B.T. and M. Gertler (2005), ‘The Geography of Innovation: Regional Innovation Systems, in J. Fagerberg, J., D. Mowery and R. Nelson (eds.), The Oxford Handbook of Innovation, pp. 291–317, Oxford: Oxford University Press.
Barney J. (2001), ‘Is the Resource-Based “View” a Useful Perspective for Management Research? Yes’, Academy of Management Review, 26(1), pp.41–56.
Barney, J. (1991), ‘Firm Resources and Sustained Competitive Advantage’, Journal of Management, 17 (1), pp. 99–120.
Barrios, S., H. Gorg, and E. Strobl (2003), ‘Explaining Firms’ Export Behaviour: R&D, Spillovers and the Destination Market’, Oxford Bulletin of Economics and Statistics, 65 (4), pp. 475–496.
Bernard, A. B., J. Eaton, B. Jensen, and S. Kortum (2003), ‘Plants and Productivity in International Trade’, American Economic Review, 93 (4), pp. 1268–1290.
Bernard, A.B. and J. Wagner (2001), ‘Export Entry and Exit by German Firms’ Weltwirtschaftliches Archiv, 137 (1), pp.105–123.
Bernard, A.B. and J.B. Jensen (1999), ‘Exceptional Exporter Performance: Cause, Effect, or Both?’, Journal of International Economics, 47 (1), pp.1–25.
Bleaney, M. and K. Wakelin (1999), ‘Sectoral and Firm-Specific Determinants of Export Performance: Evidence from the United Kingdom’, GLM Research Paper, No. 99/12, University of Nottingham.
Bonaccorsi, A. (1992), ‘On the Relationship between Firm Size and Export Intensity’, Journal of International Business Studies, 23 (4), pp. 605–635.
Braunerhjelm, P. (1996), ‘The Relationship between Firm-specific Intangibles and Exports’, Economic Letters, 53 (2), pp. 213–219.
Calof, J.L. (1994), ‘The Relationship between Firm Size and Export Behaviour Revisited’, Journal of International Business Studies, 25 (2), pp. 367–387.
Chay, K.Y. and J.L. Powell (2001), ‘Semiparametric Censored Regression Models’, Journal of Economic Perspectives, 15 (4), pp. 29–42.
Chernozhukov, V. and H. Hong (2002), ‘Three-Step Censored Quantile Regression and Extramarital Affairs’, Journal of American Statistical Association, 97 (459), pp. 872–882.
Cooke, P., M. G. Uranga and G. Etxebarria (1997), ‘Regional Innovation Systems: Institutional and Organisational Dimensions’, Research Policy, 26 (4–5), pp. 475–491.
Coviello, N. and M. Cox (2006), ‘The Resource Dynamics of International New Venture Networks’, Journal of International Entrepreneurship, 4 (2-3), pp. 113–132.
Czabanski, J. (2008), Estimates of Cost of Crime: History, Methodologies, and Implications, Berlin: Springer.
DCMSME (2009), Quick Results Fourth All India Census of Micro, Small & Medium Enterprises 2006–07, Development Commissioner (MSME), New Delhi: Ministry of Micro, Small & Medium Enterprises, Government of India.
de la Torre, J.R.(1971), ‘Exports of Manufactured Goods from Developing Countries: Marketing Factors and the Role of Foreign Enterprise’, Journal of International Business Studies, 2 (1), pp. 26–39.
Detotto, C. and E. Otranto (2010), ‘Does Crime Affect Economic Growth?’, Kyklos, 63 (3), pp. 330–345.
Doloreux, D. (2002), ‘What Should we Know about Regional Systems of Innovation?’, Technology in Society, 24 (3), pp. 243–263.
Doloreux, D. and S. Parto (2004), ‘Regional Innovation System a Critical Synthesis’, INTECH Discussion Paper, No. #2004-17, United Nations University, The Netherlands: Institute for New Technologies.
Ericson, R. and A. Pakes (1995), ‘Markov-perfect Industry Dynamics: A Framework for Empirical Work’, Review of Economic Studies, 62 (1), pp. 53–82.
Fernandez, Z and M. J. Nieto (2005), ‘Internationalization Strategy of Small and Medium-sized Family Business: Some Influential Factors’, Family Business Review, 18 (1), pp. 77–89.
Fitzgerald, B. and T. Monson (1989), ‘Preferential Credit and Insurance as Means to Promote Exports’, The World Bank Research Observer, 4 (1), pp. 89–114.
Fugazza, M. (2004), Export Performance and Its Determinants: Supply and Demand Constraints, Policy Issues in International Trade and Commodities Study Series, No. 26, United Nations Conference on Trade and Development, New York and Geneva: United Nations.
Fujita, M. and P. Krugman (2004), ‘The New Economic Geography: Past, Present and the Future’, Papers in Regional Science, 83 (1), pp. 139–164.
Fujita, M., P. Krugman, and A.J. Venables (1999), The Spatial Economy: Cities, Regions and International Trade, Cambridge MA: MIT Press.
Government of India (2010), Report of Prime Minister’s Task Force on Micro, Small and Medium Enterprises, New Delhi: Government of India.
Gumede, V. (2004), ‘Export Propensities and Intensities of Small and Medium Manufacturing Enterprises in South Africa’, Small Business Economics, 22 (5), pp.379–389.
Hollenstein, H. (2005), ‘Determinants of International Activities: Are SMEs Different?’,Small Business Economics, 24 (5), pp. 431–450.
Johanson, J. and J. E. Vahlne (1977), ‘The Internationalization Process of the Firm: A Model of Knowledge Development and Increasing Foreign Market Commitments’, Journal of International Business Studies, 8 (1),pp. 23–32.
Jones, M. V. (1999), ‘The Internationalization of Small High-Technology Firms’, Journal of International Marketing, 7 (4), pp. 15–41.
Jovanovic, B. (1982), ‘Selection and the Evolution of Industry’, Econometrica, 50 (3), pp. 649–670.
Karagozoglu, N. and M. Lindell (1998), ‘Internationalization of Small and Medium-Sized Technology-based Firms: An Exploratory Study’, Journal of Small Business Management, 36 (1), pp. 44–59.
Krugman, P. (1991a), ‘Increasing Returns and Economic Geography’, Journal of Political Economy, 99 (3), pp. 483–499.
Krugman, P. (1991b), Geography and Trade, Cambridge MA: MIT Press.
Lefebvre, E., and L.A. Lefebvre (2002), ‘Innovative Capabilities as Determinants of Export Performance and Behaviour: A Longitudinal Study of Manufacturing SMEs’, in A. Kleinknecht and P. Mohnen (eds.), Innovation and Firm Performance: Econometric Explorations of Survey Data, pp. 281–309, London: Palgrave.
Lundvall, B-Å and S. Borrás (1997), The Globalising Learning Economy: Implications for Innovation Policy. Brussels: Commission of the EU.
Melitz, M. (2003), ‘The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity’, Econometrica, 71 (6), pp. 1695–1725.
Newbert, S. (2007), ‘Empirical Research on the Resource-based View of the Firm: An Assessment and Suggestions for Future Research’, Strategic Management Journal, 28 (2), pp. 121–146.
Ngoc, A.N., N. P. Quang, C. N. Dinh and N. N. Duc (2008), ‘Innovation and exports in Vietnam's SME sector’, The European Journal of Development Research, 20(2), pp. 262–280.
Ottaviano, G. and C.V. Martincus (2011), ‘SMEs in Argentina: Who are the Exporters?’, Small Business Economics, 37 (3), pp. 341–361.
Pérez, R.P., J. Vang and C. Chaminade (2009), ‘Regional Innovation Systems in Developing Countries: Integrating Micro and Meso-level Capabilities’, in Lundvall, B-Å, K. J. Joseph, C. Chaminade and J. Vang (eds.) (2009), Handbook of Innovation Systems and Developing Countries: Building Domestic Capabilities in a Global Setting, pp. 140–182, Cheltenham, UK: Edward Elgar.
Pope, R.A. (2002), ‘Why Small Firms Export: Another Look’, Journal of Small Business Management, 40 (1), pp. 17–26.
Porter, M. E. (1998), ‘Clusters and Competition: New Agendas for Companies, Governments, and Institutions’, Harvard Business School Working Paper, No. 98–080, Massachusetts: Harvard Business School.
Powell, J.L. (1986), ‘Censored Regression Quantiles’, Journal of Econometrics, 32 (1), pp. 143–155.
Pradhan, J.P. (2008), Indian Multinationals in the World Economy: Implications for Development, New Delhi: Bookwell Publisher.
Pradhan, J.P. (2011), ‘Regional Heterogeneity and Firms’ R&D in India’, Innovation and Development, 1 (2), pp. 259–282.
Pradhan, J.P. and P.P. Sahu (2008), Transnationalization of Indian Pharmaceutical SMEs, New Delhi: Bookwell Publisher.
Redding, S. and A. J. Venables (2004), ‘Geography and Export Performance: External Market Access and Internal Supply Capacity’, in Baldwin, R. E. and L.A. Winters (eds.) Challenges to Globalization: Analyzing the Economics, pp. 95–130, Chicago: Chicago University Press.
Requena-Silvente, F. (2005), ‘The Decision to Enter and Exit Foreign Markets: Evidence from U.K. SMEs’, Small Business Economics, 25 (3), pp. 237–253.
Roberts, M. J. and J. R. Tybout (1997), ‘The Decision to Export in Colombia: An Empirical Model of Entry with Sunk Costs’, American Economic Review, 87 (4), pp. 545–564.
Rodríguez, J. L. and R. M. G. Rodríguez (2005), ‘Technology and Export Behaviour: A Resource-Based View Approach’, International Business Review, 14 (5), pp. 539–557.
Roxas, H. B. and D. Chadee (2011), ‘A Resource-Based View of Small Export Firms' Social Capital in a Southeast Asian Country’, Asian Academy of Management Journal, 16 (2), pp.1–28.
Roy, D. K. (1993), ‘Impact of Incentives on Export Performance of Bangladesh: A Preliminary Assessment’, Bangladesh Development Studies, 21 (2), pp. 25–44.
Singh, N. (2006), ‘R&D, Imports of Technology and Trade Intensities: A Simultaneous Equation Micro-level Examination’, in S. Tendulkar, A. Mitra, K. Narayanan and D. Das (eds.) India: Industrialization in a Reforming Economy–Essays for K L Krishna, pp. 471–491, New Delhi: Academic Foundation.
Storper, M. (1997), The Regional World: Territorial Development in a Global Economy, New York: Guilford Press.
UNCTAD (1999), World Investment Report 1999: Foreign Direct Investment and the Challenge of Development, New York and Geneva: United Nations.
UNCTAD (2002), World Investment Report 2002: Transnational Corporations and Export Competitiveness, New York and Geneva: United Nations.
UNCTC (1984), Costs and Conditions of Technology Transfer through Transnational Corporations, ESCAP/UNCTC Publication Series B, No. 3, Bangkok: United Nations.
UNIDO (2001), Integrating SMEs in Global Value Chains: Towards Partnership for Development, Vienna: United Nations Industrial Development Organization.
UNIDO (2006), Productivity Enhancement and Equitable Development: Challenges for SME Development, Vienna: United Nations Industrial Development Organization.
Wakelin, K. (1998), ‘Innovation and Export Behaviour at the Firm Level’, Research Policy, 26 (7–8), pp. 829–841.
Wernerfelt, B. (1984), ‘A Resource-based View of the Firm’, Strategic Management Journal, 5 (2), pp. 171–180.
Westhead, P., M. Wright, D. Ucbasaran, and F. Martin (2001), ‘International Market Selection Strategies of Manufacturing and Services Firms’, Entrepreneurship and Regional Development, 13 (1), pp. 17–46.
Wilhelm, M. O. (2008), ‘Practical Considerations for Choosing Between Tobit and SCLS or CLAD Estimators for Censored Regression Models with an Application to Charitable Giving’, Oxford Bulletin of Economics and Statistics, 70 (4), pp. 559–582.
Wu, Y., D. Fu, and Y. Tang (2010), ‘The Effects of Ownership Structure and Industry Characteristics on Export Performance: Evidence from Chinese Manufacturing Firms’, Economics Discussion Paper, No. 10-09, Department of Economics, Crawley: The University of Western Australia.
Yang, C.H., J.R Chen and W.B. Chuang (2004), ‘Technology and Export Decision’, Small Business Economics, 22 (5), pp. 349–64.
Zucchella, A. and G. Palamara (2006), ‘Niche Strategy and Export Performance’, in Zou, S. (ed.) International Marketing Research, (Advances in International Marketing), 17, pp. 63–87, UK: Emerald Group Publishing Limited.