Does the Resource Capacity of Exporters Differ Significantly from the Non-Exporters? Evidence from SMEs in an Emerging Economy

Abstract

Compared to the Small and Medium Enterprises (SMEs) that remain continuously focused on a domestic market, it is argued that those that export learn from their exporting. Exporters learn from, for example, international competitors and consumers. Based on this motivation, the internationalisation of SMEs is flourishing across the world because by determining to remain competitive in the international market, the capacity of exporting firms is enhanced. Ghana has hailed the motivation of SMEs’ internationalisation. Consequently, policies and programmes are being implemented to encourage SMEs to export. Whilst the Ghanaian exporting sub-sector is growing, it is not known whether or not the resource capacity of exporting firms differs significantly from the non-exporters. The objective of the study is to compare the resource capacity between exporting and non-exporting SMEs and to establish whether or not the Ghanaian evidence compares with findings from other developing and developed economies, as well as to further inform public policy. The study draws from a firm level panel data set from the World Bank relating to SMEs from the Ghana manufacturing sector from 2000–2002. By employing the independent sample t-test, multivariate analysis of variance and the chi-square test a number of hypotheses are tested. The results show that the capacity of the exporting firms regarding the number of employees, productivity of staff and business experience were higher and differed significantly from the non-exporting firms. Following the results, it is recommended that current export-led programmes by the government of Ghana must be deepened because of the micro returns that are derived from export participation.

Key Words: Internationalisation, Ghana, Exporting, Non-exporting, SMEs