Model of Firm-level Export Decision in the Cycles of Technological Leadership for High-Tech Industry in a Less-Developed Country

Much of the theoretical literature on the relationship between firms´ exports decision and productivity has produced rich and useful results for developed countries in the past. This paper makes a pioneering attempt to explore the determinants of firm-level export behaviors in high-tech industries in the context of a less-developed country (China). By introducing a learning effect in the cycles in technological leadership as a new explanatory variable into traditional production function, the paper develops an original two-stage micromodel of international trade. Productivity advantage always determines the export decision, and export behaviors also depend on the characteristics of technology progress in the cycle, firm´s R&D efforts and foreign direct investment. At the stage of routine technology progress, productivity advantage facilitates firms´ exporting labor-intensive parts or components of high-tech products; at the stage of introduction of new technology, firms have opportunities to become technological leader and base their export decision on innovation edge. Then, a microeconometric study is used to analyze exporter performance in China´s information and communication technology manufacturing industry