- Elgar original reference
Edited by Craig C. Julian
Chapter 9: The dynamic nature of the export development undertaking: implications for researchers and practitioners
In August 2012, New Zealand launched a new export development initiative purposely mooted to raise export values by 10 percentage points to 40 percent of gross domestic product. Export success is one of the most important ways of facilitating sustainable economic growth. Not only do exports contribute to the gross domestic product, they carry additional benefits including employment creation, a larger base for tax revenue and a general improvement in standards of living. In the wake of the global financial crisis, exporting provides a viable option for growth and economic stability. In recent years economists (e.g. Cardoso and Soukiazis, 2008) have shown evidence of the existence of these benefits using the export-led growth hypothesis. New Zealand exporters also benefit from exporting. For example, exporting is a relatively low-risk and low-investment mode of entry strategy. Exporting also allows New Zealand firms to spread their risk across several markets. Exporters also gain from stronger sales and profits, utilization of idle capacity, longer or larger production runs and increased productivity (Ahmed et al., 2006). These benefits are particularly important given New Zealand’s relatively small domestic market. However, in recent years, the aforementioned benefits of export development have not come to fruition. Indeed, in spite of concerted efforts from various stakeholders, New Zealand’s export sector is plagued by innumerable challenges. For example, the export sector is characterized by high mortality rates, which are evident for both small and larger well-established ventures (Adalet, 2009).
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