Helmut Fryges

Understanding Cross-country Differences in Exporter Premia: Comparable Evidence for 14 Countries

We use comparable micro level panel data for 14 countries and a set of identically specified empirical models to investigate the relationship between exports and productivity. Our overall results are in line with the big picture that is by now familiar from the literature: exporters are more productive than non-exporters when observed and unobserved heterogeneity is controlled for, and these exporter productivity premia tend to increase with the share of exports in total sales; there is evidence in favour of self-selection of more productive firms into export markets, but nearly no evidence in favour of the learning-by-exporting hypothesis. We document that the exporter premia differ considerably across countries in identically specified empirical models. In a meta-analysis of our results we find, consistent with theoretical predictions, that productivity premia are larger in countries with lower export participation rates, with more restrictive trade policies, lower per capita GDP, less effective government and worse regulatory quality, and in countries exporting to relatively more distant markets.

Exports and Profitability: First Evidence for German Manufacturing Firms

Using unique recently released nationally representative high-quality longitudinal data at the enterprise level for Germany, this paper presents the first comprehensive evidence on the relationship between exports and profitability. It documents that the positive profitability differential of exporters compared to non-exporters is statistically significant, though rather small, when observed firm characteristics and unobserved firm specific effects are controlled for. In contrast to nearly all empirical studies on the relationship between productivity and exports we do not find any evidence for selfselection of more profitable firms into export markets. Due to the sampling frame of the data used we cannot test the hypothesis that firms which start exporting perform better in the years after the start than their counterparts which do not start. Instead, we use a newly developed continuous treatment approach and show that exporting improves the profitability almost over the whole range of the export-sales ratio. Only firms that generate 90 percent and more of their total sales abroad do not benefit from exporting in terms of an increased rate of profit. This means, that the usually observed higher productivity of exporters is not completely absorbed by the extra costs of exporting or by higher wages paid by internationally active firms.

The Adoption of Business-to-Business E-Commerce: Empirical Evidence for German Companies

Although in its infancy, one promising application of Internet technology for firms is so-called Internet commerce or electronic commerce. This paper analyses the determinants of B2B (business-to-business) adoption borrowing from the literature on the adoption of new technologies and considering factors like firm size, corporate status, human capital and international competitive situation. An ordered probit model is applied to a data set containing about 3,000 enterprises from the German manufacturing industry and the German services sector in the year 2000. We find positive and significant effects of firm size, the share of highly qualified employees and the export share. An IT-intensive production process enhances the probability of a broad use of B2B e-commerce. An important influence on the use of B2B is the bandwagon effect, implying that firms are more likely to use this new Internet application if others within the same industry likewise do it. We find no significant effects of firm age and of the fact that a firm belongs to a group of companies as measures of a firms flexibility and financial power.

The Impact of R&D Activities on Exports of German Business Services Enterprises: First Evidence from a Continuous Treatment Approach

This study uses newly available representative data from German business services firms and a continuous treatment approach based on the generalized propensity score to test for a causal effect of R&D activities (measured by the share of engineers and natural scientists in all employees) on the share of exports in total sales. We find evidence for a positive and statistically significant but small causal effect. This result is in line with the (non-causal) results reported in Vogel and Wagner (2012) based on regression models with and without control for unobserved time-invariant firm characteristics. The bottom line, then, is that R&D activity does matter for success of German business services firms on export markets – but not much.

The KfW/ZEW Start-up Panel: Design and Research Potential

So far, there has been no data set which observes firm formations in Germany not only on a cross-sectional basis using one-time surveys, but continuously over a number of years. Therefore, the Centre for European Economic Research (ZEW), KfW Bankengruppe and Creditreform set up a panel study of newly founded firms in Germany: the KfW/ZEW Start-up Panel. In each of the yearly panel waves computer-aided telephone interviews (CATI) are conducted with about 6,000 start-up firms from almost all industries. The KfW/ZEW Start-up Panel will for the first time enable profound analyses of the temporal development of newly founded firms, including studies of firm survival. This paper describes the design of the KfW/ZEW Start-up Panel. The survey’s research potential is illustrated using data from the first panel wave conducted in the year 2008. Data access for external researchers and data protection issues of the confidential micro data are discussed.

The Change of Sales Modes in International Markets - Empirical Results for German and British High-Tech Firms

The choice of the appropriate sales mode belongs to the firms most important strategic decisions after entering into a foreign market. Thus, it is important that the selected foreign sales mode best suits a firms available resources and capabilities. However, these resources and capabilities change over time. Therefore, it might be necessary for a firm to adjust its foreign sales mode to these changing firm-specific conditions. Using a longitudinal data set of newly founded technology-based firms in Germany and the UK, this paper applies logistic regressions and analyses empirically the probabilities of changing between the two sales modes most frequently used by the sampled exporters: direct exports and exporting via an intermediary. The estimation results confirm the importance of the firms physical and intangible resources as well as the influence of transaction-specific assets on a sales mode change. However, the effects of the latter factors might be dominated by strategic considerations that are not covered by our data. For example, a young high-tech firm will resort to an intermediary regardless of its resources and transaction-specific assets if this is the only way of coming into contact with foreign customers.

Estimating Dynamic R&D Demand: an Analysis of Costs and Long-Run Benefits

Using firm-level data from the German manufacturing sector, we estimate a dynamic, structural model of the firms decision to invest in R&D and quantify the cost and longrun benefit of this investment. The model incorporates and quantifies linkages between the firms R&D investment, product and process innovations, and future productivity and profits. The dynamic model provides a natural measure of the long-run payoff to R&D as the difference in expected firm value generated by the R&D investment. For the median productivity firm, investment in R&D raises firm value by 3.0 percent in a group of hightech industries but only 0.2 percent in low-tech industries. Simulations of the model show that cost subsidies for R&D can significantly affect R&D investment rates and productivity changes in the high-tech industries.

Performance von akademischen Spinoff-Gründungen in Österreich

ZusammenfassungVergleicht man akademische Spinoff-Gründungen mit anderen forschungs- und wissensintensiven Gründungen, zeigt sich, dass Spinoff-Gründungen signifikant forschungs- und wissenschaftsorientierter sind. Dies drückt sich in höherer Forschungsintensität, höherer Patentierneigung und intensiveren Kontakten zur Wissenschaft aus. Spinoff-Gründungen besetzen ein besonders forschungsintensives Segment innerhalb der forschungs- und wissensintensiven Branchen und stellen eine Verbindung zwischen Wissenschaft und Markt her. In diesemPapier wird für Österreich untersucht, ob sich die Performance von Spinoff-Gründungen von der anderer Gründungen in den forschungs- und wissensintensiven Wirtschaftszweigen unterscheidet. Ökonometrische Modellrechnungen zeigen, dass Spinoff-Gründungen hinsichtlich Umsatz- und Beschäftigungswachstum nicht erfolgreicher sind als andere Gründungen in den forschungs- und wissensintensiven Branchen. AbstractWhen academic spin-offs are compared with other research- and knowledge-intensive start-ups, it is apparent that spin-offs are significantly more research- and knowledge-oriented than other start-ups. This fact becomes evident in higher research intensity, higher inclination to patenting and more intensive contacts to science. Spin-offs fill a particularly research-intensive segment within the research- and knowledge-intensive sectors and establish a connection between science and market. In this paper, for Austria, it is investigated if the performance of spin-offs differs form that of other research- and knowledge-intensive start-ups. Econometric model calculations show that spin-offs are as for turnover and employment growth not more successful than other start-ups in the research- and knowledge-intensive sector.

The Interdependence of R&D Activity and Debt Financing of Young Firms

We investigate the interdependence of debt financing and & activities of young firms. Applying a bivariate Tobit model, we find that there is a positive interdependent relationship between the share of loan financing and & intensity. A higher share of loan financing allows for more & in young firms and, at the same time, a higher & intensity allows for a higher loan share. This result is mainly driven by start‐ups exhibiting high values of & intensity or leverage. Another remarkable result of our study is that the positive relationship between & and loan financing can only be detected if we consider that, first, the decisions on & and on loan financing are made simultaneously and, second, the decision on & impacts the decision on loan financing and vice versa.

Job Machine, Think Tank, or Both – What Makes Corporate Spinoffs Different?

One way through which knowledge and technology transfer can take place is through the foundation of new firms by former employees of incumbent private firms. In this paper, we examine whether knowledge transferred from the incumbent causally affect employment growth and post-entry innovation activities of the new firm. We focus on start-ups for which a new idea (a new product, technology, production process or management concept), which the founder developed during her work as an employee, was essential for setting up the new business. These firms are denoted corporate spinoffs. Using data from German start-ups founded in the period from 2005 to 2008, we apply nearest neighbour propensity score matching. We find that corporate spinoffs outperform other start-ups founded by former employees of incumbent private firms that are not based on an essential idea in terms of post-entry innovation activities. However, we cannot show that corporate spinoffs benefit from the transferred idea in terms of employment growth. We conclude that a transferred idea is primarily an input factor and a stimulus for subsequent post-entry innovation activities of corporate spinoffs.