Impact of Competitive Position on Export Propensity and Intensity: An Empirical Study of Manufacturing Firms in China

Competitive industry position has an impact on firms' export propensity and intensity. The resource-based view and the structure-conduct-performance paradigm of firm behavior are used to investigate whether firms with a competitive industry position through cost leadership or differentiation strategy have different export behaviors. Longitudinal data for 213,662 manufacturing firms in China from 1998 to 2005 show that firms that have competitive advantages in the domestic market are more likely to export and have higher levels of export intensity. Indigenous and foreign manufacturing firms exhibit different patterns of export behavior. Foreign firms with differentiation advantages focus on local market expansion instead of seeking opportunity in export markets.