THE IMPACT OF INTERNATIONAL QUALITY STANDARD CERTIFICATION (IQSC) FOR ETHIOPIAN AND EGYPTIAN FIRMS’ PARTICIPATION IN EXPORT MARKET

Export is considered as the backbone of a country’s economy. Export plays a vigorous role in the economic growth of a country. But a company’s decision of becoming an export firm has certain constraints. This paper examines The International Quality Standard Certification (IQSC) and the firm's participation in the export market of Egypt and Ethiopia. By considering the volume, Egypt is one of the top exporters in Africa, while Ethiopia is considered an average exporter. We tend to find why some country’s firms try to export more while others are less. Does the International Quality Standard Certification (IQSC) matter for firms’ participation in the export market? How different are the characteristics of exporting firms in different countries? What other factors determine the firms’ participation in the export market. We found that firms having IQSC export more than the firms that don’t have IQSC and they have a comparative advantage. Due to economies of scale and higher efficiency, large firms have an advantage over small and medium firms on exporting to international markets. The firm’s age is not an important factor for the probability to export. Productive, aged, foreign-owned and large firms usually export more than their counterparts. KEY WORDS: IQSC (International Quality Standard Certificate), International Trade, Export Decision, Probit model analysis, IV regression.