A portrait of success: Uruguayan firms in international trade

This article provides a portrait of firm heterogeneity in connection with international activities. We analyse the impact of the extensive margins of exports and imports and of trade with different types of partners on firms’ performance, using detailed national customs and manufacturing firm survey data from Uruguay for the period 1997–2005. This is the first study to use customs data and analyse the extensive margins of trade and types of partner for Uruguayan firms. In line with previous studies, we find that trade is highly concentrated and that firms which both export and import show a superior performance. Furthermore, the product extensive margin of imports and the country extensive margin of exports have positive effects on two key variables: total factor productivity and employment. Where trade is concerned, lastly, firms trading with both high-income countries and Southern Common Market (MERCOSUR) partners are the best performers.