Date Added: Mar 2011
Recent heterogeneous-firm models of international trade suggest that productivity determines whether firms engage in export and foreign direct investment. However in practice, m Abstract any productive firms are not internationalized, whereas many unproductive firms are. This situation suggests that factors other than productivity influence internationalization. This paper examines a set of potential factors - personal characteristics of the Chief Executive Officer (CEO) - using a unique panel dataset for Japanese Small and Medium Enterprises (SMEs). The authors find that SMEs are more likely to be internationalized when the CEO is more risk-tolerant, forward-looking, and internationally experienced.