Seker, Murat2014-09-022014-09-022009-12https://hdl.handle.net/10986/19957Recent studies have shown that not only exporters but also importers perform better than firms that do not trade. Using a detailed firm level dataset from 43 developing countries, I show that there are persistent differences in evolution of firms when they are grouped according to their trade orientation as: two-way traders (both importing and exporting), only exporters, only importers, and non-traders. Extending the existing models of firm evolution in open economies by incorporating importing decision, I show that: i) globally engaged firms are larger, more productive, and grow faster than non-traders; ii) two-way traders are the fastest growing and most innovative group who are followed by only-exporters; iii) estimating export premium without controlling for import status is likely to overestimate the actual value by capturing the import premium; and iv) R&D investment contributes to growth of traders significantly more than to non-traders. Finally I show the robustness of the findings by providing evidence from the panel data constructed from the original dataset and controlling for variables that are likely to affect firm growth.en-USCC BY 3.0 IGOACCESS TO FOREIGN MARKETSCAPITAL STOCKCERTIFICATECERTIFICATESCOMPANYCORRELATION MATRIXCOUNTRY FIXED EFFECTSDATA ANALYSISDEVELOPING COUNTRIESDOMESTIC MARKETDOMESTIC MARKETSDRIVERSECONOMIC ACTIVITYECONOMIC ANALYSISECONOMIC DEVELOPMENTECONOMIC SURVEYSECONOMICSELASTICITYELASTICITY OF SUBSTITUTIONEMPLOYMENTEMPLOYMENT GROWTHEMPLOYMENTSENTERPRISE SURVEYSEQUIPMENTEXCHANGE RATEEXPECTED PRESENT VALUEEXPORT MARKETEXPORTSEXPOSUREEXTERNAL FINANCEFINANCIAL INSTITUTIONSFINANCIAL INTERMEDIARYFIRM GROWTHFIRM PERFORMANCEFIRM SIZEFIRMSFIXED COSTFOREIGN INPUTSFOREIGN MARKETSFOREIGN OWNERSHIPGDPGDP DEFLATORGENERAL EQUILIBRIUMGLOBAL ECONOMYGLOBAL MARKETSGLOBALIZATIONGROWTH RATEGROWTH RATESHUMAN CAPITALINDUSTRIAL ECONOMICSINDUSTRIAL STRUCTUREINDUSTRY PRODUCTIVITYINNOVATIONINNOVATION FUNCTIONINTEREST RATEINTERNATIONAL MARKETSINTERNATIONAL TRADELABOR PRODUCTIVITYLICENSELICENSESLOCAL CURRENCIESMANUFACTURERSMANUFACTURINGMANUFACTURING INDUSTRIESMANUFACTURING INDUSTRYMARGINAL COSTMARKET COMPETITIONMATERIALMONOPOLISTIC COMPETITIONMONOPOLYMONOPOLY RENTSNEW PRODUCTNEW PRODUCTSOPEN ECONOMIESOUTPUTOWNERSHIP STRUCTUREPERFORMANCE MEASURESPOLITICAL ECONOMYPRICE MOVEMENTSPRIVATE SECTORPRIVATE SECTOR DEVELOPMENTPRODUCT DIFFERENTIATIONPRODUCT INNOVATIONPRODUCTION FUNCTIONPRODUCTION PROCESSESPRODUCTIVITYPRODUCTIVITY GROWTHPROFIT MAXIMIZATIONR&DREGRESSION ANALYSISRELIABILITYRENTSRESULTRESULTSROBUSTNESS ANALYSISSALES GROWTHSENSITIVITY ANALYSISSUNK COSTSTECHNOLOGICAL CHANGETECHNOLOGICAL INNOVATIONTECHNOLOGICAL INNOVATIONSTECHNOLOGY DIFFUSIONTECHNOLOGY TRANSFERTOTAL REVENUETRADE LIBERALIZATIONTRADE POLICIESTRADING ACTIVITIESUSESWAGESWEBWORLD ECONOMY10.1596/1813-9450-5156