Browsing by Subject "export potential"

This paper places its focus on the largest 10 high-tech importers of Finland with the objective to investigate the determinants of Finnish high-tech exports during the period of 1996 and 2010. The Gravity Theory acts as the theoretical foundation of the study and panel data will be adopted to carry out OLS regression and fixed effects regression models. Six clusters of determinant have been introduced to the basic gravity empirical model respectively, seeking to identify categories which have the greatest effects on Finnish high-tech exports. The research finds that the variables related to information cost, labour market and high technological level are more impactful than other factors. An adjusted gravity empirical model with more than 70 per cent explanatory power is subsequently presented. The empirical results manifest that a 1 per cent increase in GDP of Finland’s major trading partners contributes to 0.35 per cent growth in Finnish high-tech exports while a 1 per cent rise in bilateral distance between Finland and its exporting destinations leads to a decline of 0.8 per cent in Finnish high-tech exports. Other independent variables included in this empirical equation are estimated to be statistically significant as well. A case study has been introduced to illustrate certain aspects of the paper as well. The adjusted gravity model together with the Reveal Comparative Advantage (RCA) index are employed to analyse the export potentials of high-tech commodities of China for Finland. The study shows that the high technology export potential is not great, and has the requisites for Finland to develop export potential of products that have comparative advantages over China’s and explore new high-tech commodities.