Received 27 January 2003; received in revised form 12 April 2004; accepted 14 December 2004 | Johannes Van Biesebroeck
The paper examines the impact of exporting on productivity in manufacturing firms in nine sub-Saharan African countries. The findings indicate that exporters are more productive than non-exporters, and this productivity advantage increases after firms enter the export market. While the initial productivity differences can be attributed to self-selection, the post-entry productivity gains are significant and robust across different econometric methods. Scale economies are identified as a key factor in these productivity improvements. Credit constraints and contract enforcement issues prevent domestic firms from fully exploiting scale economies, making exporting a crucial channel for productivity enhancement. The study also highlights the importance of trade credit and contract enforcement in facilitating the expansion of exporting firms, particularly in addressing domestic market constraints. Overall, the results suggest that trade liberalization can significantly boost productivity in sub-Saharan African manufacturing firms.The paper examines the impact of exporting on productivity in manufacturing firms in nine sub-Saharan African countries. The findings indicate that exporters are more productive than non-exporters, and this productivity advantage increases after firms enter the export market. While the initial productivity differences can be attributed to self-selection, the post-entry productivity gains are significant and robust across different econometric methods. Scale economies are identified as a key factor in these productivity improvements. Credit constraints and contract enforcement issues prevent domestic firms from fully exploiting scale economies, making exporting a crucial channel for productivity enhancement. The study also highlights the importance of trade credit and contract enforcement in facilitating the expansion of exporting firms, particularly in addressing domestic market constraints. Overall, the results suggest that trade liberalization can significantly boost productivity in sub-Saharan African manufacturing firms.