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Firm Exports, Foreign Ownership, and the Global Financial Crisis

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Listed:
  • Peter Eppinger
  • Marcel Smolka
Abstract
This paper shows theoretically and empirically how access to finance explains the exceptional export performance of foreign-owned firms. We build a model of heterogeneous exporters in which foreign-owned firms can access foreign capital markets via their multinational parents. The model predicts that foreign ownership makes exports more resilient to deteriorating credit conditions. To empirically identify this effect, we estimate a triple differences model using rich micro data from Spain and exploiting the global financial crisis as an exogenous shock to credit supply. We find that foreign ownership significantly stabilized firm exports in the crisis, in particular among financially vulnerable firms.

Suggested Citation

  • Peter Eppinger & Marcel Smolka, 2020. "Firm Exports, Foreign Ownership, and the Global Financial Crisis," CESifo Working Paper Series 8808, CESifo.
    • Handle: RePEc:ces:ceswps:_8808
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    Citations

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    Cited by:

    1. Jacob A. Jordaan, 2023. "Firm‐level characteristics and the impact of COVID‐19: Examining the effects of foreign ownership and international trade," The World Economy, Wiley Blackwell, vol. 46(7), pages 1967-1998, July.
    2. Bykova, Anna & Jardon, Carlos M., 2017. "Lean against the wind: The moderation effect of foreign investments during the economic recession in Russia," Journal of Economics and Business, Elsevier, vol. 93(C), pages 1-14.
    3. Unger, Florian, 2023. "Financial Development and Export Concentration," VfS Annual Conference 2023 (Regensburg): Growth and the "sociale Frage" 277570, Verein für Socialpolitik / German Economic Association.
    4. Peter S. Eppinger & Nicole Meythaler & Marc-Manuel Sindlinger & Marcel Smolka, 2018. "The great trade collapse and the Spanish export miracle: Firm-level evidence from the crisis," The World Economy, Wiley Blackwell, vol. 41(2), pages 457-493, February.
    5. David Córcoles & Carmen Díaz-Mora* & Rosario Gandoy, 2016. "Complex Internationalization Strategies and Firm Export Dynamics: Crisis and Recovery," Working Papers 16-05 Classification-JEL , Asociación Española de Economía y Finanzas Internacionales.

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    More about this item

    Keywords

    firm exports; foreign ownership; multinational firms; financial frictions; financial crisis;
    All these keywords.

    JEL classification:

    • F10 - International Economics - - Trade - - - General
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • G01 - Financial Economics - - General - - - Financial Crises
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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