Firm-Level Determinants of Exporting Behaviour: Evidence from Kenyan Manufacturing Firms

Abstract

This paper uses firm-level panel data to investigate the exporting behaviour of the Kenyan manufacturing firms. Using probit and tobit regression models, the results obtained show that factors determining the decision to export are different from those affecting the share exported. Likewise, factors determining exporting behaviour to the African market are different from those affecting exporting to the non-African countries. The paper therefore suggests that to improve on the exporting behaviour of manufacturing firms in Kenya, it is important to distinguish between policies meant for domestic and regional markets from those meant for the markets outside Africa.

Keywords: Exporting behaviour, firm-level characteristics, business environment factors, sunk cost.