1、THE EXPORT DECISION PROCESS: AN EMPIRICAL INQUIRY CLAUDE L. SIMPSON, JR. * DUANE KUJAWA This study profiles export decision-makers in both exporting and nonexporting firms, in terms of their perceptions of the risks and cost/benefit trade-offs associated with exporting, and their reactions to variou
2、s types of stimuli to export. It concludes an export stimulus (e.g., an unsolicited order from a foreign customer) is a significant but not sufficient condition for a positive export decision, and that important variations between exporters and nonexporters in cost, profit, and risk perceptions may
3、well account for different responses to simi- lar stimuli by these two groups. Present public policies to promote exports are critiqued in light of the findings. Recent public policy initiatives in the United States focus heavily on foreign trade imbalances and the need for effective “export expansi
4、on“ programs. Some initiatives have been aimed at restructuring the general economic and commercial environment affecting international competi- tive relationships. Others have been more “microscopic“ and aimed at encouraging American producers to begin or expand export activities. These include tax
5、 incentives, improved export financing, reducing trans- portation costs, and expanding export promotion programs.2 These as- sume a particular profile of an export decision-maker, i.e., a rational, economic being consciously seeking to expand profits and/or reduce busi- ness risks. But how accurate
6、is this assumption? Are our policy initiatives meaningfully related to attainment of the objective of expanding exports? For example, are the tax benefits of the Domestic International Sales Corporation (DISC) causing businessmen to export more? If not, could the net (intended) social benefits of th
7、e DISC be deficient in view of the social cost of the deferred tax revenues? *Claude L. Simpson, Jr. (Ph.D., Georgia State University) is Associate Professor of Marketing, Southeastern Louisiana University, and Duane Kujawa (Ph.D., University of Michigan) is Associate Professor of Economics, and Mem
8、ber of the Institute of Interna- tional Business, Georgia State University. This article uses data gathered by Professor Simpson in his dissertation research. His dissertation, “The Export Decision: An Interview Study of the Decision Process in Tennessee Manufacturing Firms,“ tied for first place in
9、 the 1973 AIB dissertation competition. 107 Palgrave Macmillan Journalsis collaborating with JSTOR to digitize, preserve, and extend access toJournal of International Business Studieswww.jstor.orgThis study challenges this assumption of “homo economicus“ and seeks to profile the export decision-make
10、r by inquiring (1) into his percep- tions of the risks and cost/benefit relationships associated with exporting and (2) into his reaction to various hypothesized export stimuli. This inquiry encompasses the total population involved in the deci- sion process-exporters, both fortuitous and systematic
11、, and nonexport- ers.: It focuses in the following questions: 1. Do decision-makers in the firms being studied systemati- cally initiate investigations of foreign markets, or do exports arise from fortuitous circumstances? 2. Why do some decision-makers make positive export deci- sions and others ne
12、gative ones, when, in some instances, the stimuli or impetus to export may be apparently similar? RESEARCH METHODOLOGY Business decisions are assumed to be a function of perceived risks and anticipated profits. These include export decisions. If the risks asso- ciated with exporting are offset with
13、high profit potential, a positive decision will be made. The rational businessman is assumed to be seeking constantly to expand profits and thus consciously investigates and evalu- ates exporting as a means to this end. “Internal“ stimuli possibly support- ing this latter type of activity were ident
14、ified in open-ended interviews during a prestudy of twenty Tennessee manufacturers and are as follows: I. Excess capacity 2. Production of a (domestically) seasonal product 3. Entry of domestic competitors into export markets 4. Profit motivation Other, “external“ stimuli were identified in the pres
15、tudy which could assume somewhat less objective-oriented behiavior motivation. These are: 1. Trade mission activities 2. Trade fairs 3. U.S. Department of Commerce activity 4. Sales agent activity 5. Fortuitous orders from foreign customers The prestudy uncovered a variety of perceptions of managers
16、 regard- ing risk and cost/benefit expectations, as well as several managerial “characteristics,“ or experiences, associated with exporting. These “envi- ronmental“ factors are: I. Perception of risk in the export market vs. risk in the domestic market 108 2. Amount of international travel 3. Level
17、and type of education 4. Expropriations 5. Foreign exchange and related controls 6. Communication barriers 7. Profit perception, domestic vs. export 8. General cost perception; domestic vs. export, plus specific cost variables including: a) executive time b) packaging c) insurance d) clerical time e
18、) product adaptations f) shipping The stimuli and environmental factors were investigated during in- terviews with 120 manufacturing firms located in Tennessee. A stratified random sample of fifty decision-makers of exporting firms which began exporting since 1967 and seventy decision-makers of none
19、xporting firms was selected.4 The interviews were conducted during the latter half of 1972. The presence or absence of various export stimuli was duly noted during each interview. The different responses of exporters and nonexpor- ters alike were then tabulated and analyzed qualitatively.5 The opini
20、ons and attitudes on environmental factors as they related to export decision-making were recorded on an ordinal scale. Given this type of response, and since the distribution and parameters of the population were not known, non-para- metric statistical testing was employed. Specifically, the Kolmog
21、orov- Smirnov Two-Sample test was used to determine whether or not two inde- pendent samples had been drawn from the same population or from popula- tions with the same distribution. Also, with Kolmogorov-Smirnov test, direction (i.e., is the experimental group greater than the control group in some
22、 way?) can be determined.6 ORIGINS OF EXPORT ACTIVITY Based on the results of this study, as developed from the stratified sample of exporting and nonexporting firms, decision-makers of small and medium-size Tennessee manufacturing firms do not act directly to enter export markets to any large degre
23、e. All exporting firms and 54 percent of the nonexporting firms included in the study were exposed to stimuli which were external to the firm. Thus, an external stimulus is a significant but not sufficient condition for initiation of exports. The external stimulus most frequently cited was the unsol
24、icited order from a foreign customer. Eighty-two percent of the exporting firms were exposed to this stimulus. In contrast, 30 percent of the nonexporters received stimuli in this category. Consequently, unsolicited (fortuitous) 109 orders from foreign customers were found to be the most important i
25、ndividual stimulus influencing the initiation of export activity. The exporting decision-makers who had received an order from a foreign customer were asked to describe the circumstances under which the order was received. In nearly every instance they had no specific idea why they had received such
26、 an order. The data revealed that other stimuli were not as important as influ- encing the export decision. These included trade missions and trade fair participation. Two stimuli-U.S. Department of Commerce and sales agent activ- ity-were found in several instances among nonexporters. Of the nonex-
27、 porting decision-makers, 7 percent, as compared with none of the export- ing decision-makers (i.e., prior to the commencement of export activity), had been approached by the U.S. Department of Commerce regarding the benefts of exporting their products. Since no exporting firm indicated this activit
28、y influenced its initial decision, the Departments efforts are apparently in vain. Yet, it is probable that these efforts, dating from recent times, are concentrated among nonexporters, thus explaining these findings. It appears, however, that the Commerce Department was un- able to get these nonexp
29、orters to consider exporting because of lack of interest or possibly other factors. Export promotion activities by foreign sales agents follow a similar pattern. Over 17 percent of the nonexporting firms received this stimulus, while none of the exporters claimed to have exported as a result of this
30、 stimulus. Each of the firms that received this stimulus rejected it because the firm was not interested in what the sales agents had to offer. No nonexporting firm indicated having reacted to, analyzed, or oth- erwise “received“ any internal stimuli. Of the exporting firms, 21 percent indicated tha
31、t profit motives were of prime consideration. Other internal stimuli studied, such as seasonal products and competition, were appar- ently inconsequential for both exporters and nonexporters alike. Of special interest, however, is the excess production capacity stimu- lus. The data indicated only 4
32、percent of the exporters noted excess capacity as a prime factor in initiating foreign sales. This is corroborated by the fact that the export and nonexport groups had an average excess capacity of 24.0 percent and 24.7 percent respectively. Various other internal stimuli, such as advertising, trave
33、l opportuni- ties arising from exporting, and an international marketing capability were mentioned by a total of six of the exporting firms included in the study as a primary initiating factor. Appearances are that the study participants did not systematically originate investigations of foreign mar
34、kets. Exporting came about much more frequently as the result of fortuitous circumstnces. 110 THE EXPORT DECISION As already discussed, the second question examined in this study focuses on why some decision-makers make positive export decisions and others negative ones, while the export stimuli may
35、 often be similar. One conclusion from the preceding analysis is that stimuli per se are not sufficient in themselves to bring about the initiation of export activities, since as many nonexporters were exposed to the same stimuli as export- ers, but with no positive results. The decision to export i
36、s therefore made with a combination of the proper stimulus and the proper perception of factors involved in the export process itself. For example, certain stimuli-namely, an order from a foreign cus- tomer and the simple profit motive-were significant factors influencing a positive export decision.
37、 But negative decisions also resulted when these stimuli were present. Therefore, other factors must account for the type of decision made. Table I presents a summary of the aforementioned environmental factors thought to influence export decision-making behavior and the accompanying statistical sig
38、nificance levels. TABLE 1 Factors Hypothesized to Influence Export Initiation: Exporters vs. Nonexporters Factor Being Tested Risk International Travel Education Level Expropriations Foreign Exchange Problems Communications Profit General Cost Executive Time Packaging Insurance Clerical Costs Produc
39、t Adaptations Shipping Costs Source: Personal Interviews. Is There A Significant Difference? Yes No Yes No No Yes Yes Yes Yes Yes Yes Yes Inconclusive Yes Kolmogorov-Smirnov Approximation of Chi-Squared X2= 7.88; p.95 X(2)- 7.48; p.90 X2(2)= .75; p.70 X22= 19.61; p.001 X2(2)=28.01; p.OOl (2 = 36.46;
40、 p.001 X(2 = 19.61; p.001 X2(2)=26.88; p.0 X2(2=42.00; p.001 X2(2)= 10.5 ; p.01 X2(2)=37.91; p.001 111 The negative export decision is made of basically the same stimuli and decision variables. Why, then, did one group decide to export and the other group decide not to export, especially since 48 of
41、 the 70 nonex- porters stated that they could export? The answer lies in the decision variables. Table 2 presents an analysis of these variables. TABLE 2 Comparison of Weighted Mean Responses of Significant Export Decision Variables Between Exporters and Nonexportersa Exporters Non-exporters Signif-
42、 Mean Mean icance Variable Response Response Difference Level Risk 4.08 4.86 - .78 p.02 Profit 4.26 3.01 +1.25 p.001 Education 3.92 3.23 + .59 p.05 Communications 4.76 5.77 -1.01 p.001 Costs 3.84 5.84 -1.96 p.001 Executive Time 4.38 5.87 -1.49 p.001 Packaging 4.76 5.77 -1.01 p.001 Insurance 4.20 5.1
43、9 - .99 p.001 Clerical Time 4.92 5.67 - .67 p.01 Shipping 4.58 6.06 -1.48 p.001 Source: Personal Interviews. a There were 50 exporters and 70 nonexporters in these groups. b These responses were allowed on a seven point ordinal scale. Exporters had a higher weighted mean level of profit perception t
44、han did the nonexporters. The exporting decision-makers mean response was 4.26 on a seven point ordinal scale that ranged from “considerably less than domestic“ to “considerably greater than domestic,“ which is some- what greater than “equal to the domestic“ profit response category. Nonexporters ha
45、d a mean response of 3.01, which for all practical pur- poses is a “less than domestic“ response category. Exporting decision-makers very nearly averaged out as college grad- uates with a 3.92 weighted mean response. A response level of 4 is a Bachelors degree response. The nonexporting decision mak
46、ers mean response is 3.23, which is slightly greater than the “some college“ re- sponse. 112 The perception of risk by the two groups is different. The exporting decision-makers felt that the risks involved in exporting were slightly higher on the average than risk domestically at a mean resonse of
47、4.08. This compared to the nonexporters response of 4.86, which is almost one ordinal frame greater than the exporters responses. Although the export- ers felt risk to be greater in exporting, they did indicate that this risk was significantly less than the level indicated by the nonexporters. The n
48、onexporters have a higher negative weighted mean perception in every cost variable than do the exporters. Risk analysis is equally significant when comparing the perceptions of nonexporters and exporters (prior to initiation of exports) who were exposed to the same stimuli. Table 3 presents the resu
49、lts of this analysis on the same basis as presented in Table 2. TABLE 3 Weighted Mean Responses of Significant Export Decision Variances for Exporters and Nonexporters Receiving Unsolicited Orders from Foreign Customers Exportersa Nonexportersb Level of Variable Mean Response Mean Response Difference Significance Risk 4.07 5.26 -1. i9 p.001 Profit 4.15 2.95 +1.20 p.001 Education 3.83 3.23 + .60 p.05 Communications 4.66 5.86 -1.20 p.001 Costs 3.71 5.76 -2.05 p.001 Executive Time 4.34 5.76 -1.42 p.001 Packaging 4.68 5.62 - .94 p.001 Insurance 4.07 5.33 -1.26 p.00 I Clerical 4.83 5.90 - .
