Exports and Productivity in the German Business Services Sector. First Evidence from the Turnover Tax Statistics Panel

A wide range of empirical studies has analysed the relationship between exports and productivity in the manufacturing sector. By contrast, a detailed investigation of the services sector has remained neglected. To close this gap, this paper provides first evidence about export and productivity in the German business services sector. The database used is the German turnover tax statistics panel, which allows for the first time a detailed longitudinal analyses of exporting business services enterprises. Similar to the manufacturing sector, these enterprises are more productive than non-exporters, and more productive business services enterprises self-select into export markets. However, no evidence is found concerning the hypotheses that exporting increases productivity.