Research on the Effect of Product Quality Upgrading on Firms' Export Performance: Based on the Micro Evidence of Quality Awards, Well-known Trademarks and Quality Certification

Abstract

The existing literature lacks the classification of product quality upgrading levels and ignores the effect of product quality upgrading at different hierarchical levels on firms' export performance. Based on this, this paper takes Chinese manufacturing exporters as the research subjects, using panel fixed effects and instrumental variables methods, and empirically examines the effect of product quality upgrading (and product quality upgrading at different levels) on firms' export performance using the 2000-2013 China Import and Export Customs Database, the China Industrial Enterprises Database, and a self-curated product quality upgrading database. The results of the research show that the number of Chinese manufacturing exporters that have upgraded their product quality is increasing. The mean and the level of product quality upgrading are both constantly elevating. Product quality upgrading has a significant positive effect on export performance, and the positive effect of product quality upgrading on export performance is greater for high-level product quality upgrading than for low and medium-level product quality upgrading. The positive effect of product quality upgrading on export performance is greater for state-owned enterprises, small enterprises, and enterprises in central and western regions. The empirical results help to refine the understanding of the export growth effect brought by product quality upgrading and provide micro evidence for China's "Great Power of Quality" strategy.