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Without export diversification, such states are vulnerable to economic shocks.
This paper investigates a largely unexplored dimension of export performance, firm level determinants of export diversification.
Research from the WTO found a strong relationship in Mauritius between export diversification and economic growth.
Mejía JF (2011) Export Diversification and Economic Growth: An Analysis of Colombia's Export Competitiveness in the European Union's Market.
This evidence suggests that additional trade liberalization could well be part of the strategy to enhance export diversification.
We extend innovation studies and enrich the export literature by analyzing the role of firms' innovation and market strategies in explaining export diversification.
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We used a robustness test by substituting the export country diversification using the entropy measure of international diversification, which has been widely documented in the recent international business literature (e.g. Deng, Jean, & Sinkovics, 2017; Hitt et al., 1997; Qian, Khoury, Peng, & Qian, 2010).
Hypothesis 2 (H2): Export country diversification strengthens the negative relationship between high ownership concentration and export intensity.
To test H2, we use export country diversification as the moderating variable.
Moreover, we hypothesize that export country diversification strengthens the relationship between ownership concentration and export intensity, because broad geographic dispersion increases risk exposure and principal-agent problems.
We further hypothesize that export country diversification poses higher uncertainties to firms, and therefore accentuates the negative relationship between ownership concentration and export intensity.
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