What explains differences in firm-level export performance?

This research project examines the consequences of firm-level factors on export performance in Finland. The project utilizes combined firm and product-level data from both Finland and Sweden. Sweden is an interesting comparison country, because Finland competes – at least partly – with the same products and industries as Sweden. Accordingly, after the EU membership, the regulatory environment has become more similar between the two countries. On the other hand, during the period following a global economic crisis, the export performance and overall recovery from the shock has been notably faster in Sweden than in Finland. .

The Finland-Sweden comparison at the firm- and product-level helps us to understand to what extent the difficulties faced by Finnish exporters are related to product and firm-specific factors and to what extent they are caused by different cost structures of similar production.

This research project draws particular attention to the firm-specific factors such as marketing costs and the share of the workers specializing in sales and marketing. Regarding the export industry, it is important to analyze more precisely the impact of marketing and other firm-specific factors on the export performance in the long-run. Especially from the perspective of productivity growth, we need new research on the risks faced by Finnish exporters and how to recover from these shocks.