The impact of sizeof the firm and exchange rate in the export propensity of domestic and foreign owned firms in a developing country: A study of the Brazilian exporters

Abstract

Integrating the resource based view and theory behind exchange rates, this study analysis the export propensity of domestic and foreign owned Brazilian exporters. Panel data of 214 of the biggest Brazilian firms with years ranging from 2001 to 2010 is used with a fixed effects logistic regression. Results suggest that Size and Real Effective Exchange Rate affect the export propensity of firms differently, depending on the source of ownership of the firm. Size will have a high positive impact on the export propensity of foreign owned Brazilian firms, while the Real Effective Exchange Rate will have a low but positive impact on the export propensity of Brazilian owned firms.