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Uni Internatioral 300 N. Zeeb Road Ann Arbor, Ml 48106 8311785 Opena, Camilo Lalap EXPORT BEHAVIOR AND INCENTIVES OF THE AGRIBUSINESS FIRMS IN THE PHILIPPINES The Ohio State University PH.O. 1983 University Microfilms I n tern stion si300 N. zeeb Road, Ann Arbor. Ml 48106 PLEASE NOTE: In all cases this material has been filmed in the best possible way from the available copy. Problems encountered with this document have been identified here with a check mark V 1. Glossy photographs or pages. 2. Colored illustrations, paper or _____print 3. Photographs with dark background_____ 4. Illustrations are poor copy______ 5. Pages with black marks, not original copy. 6. Print shows through as there is text on both sides of page. 7. Indistinct, broken or small print on several pages^ 8. Print exceeds margin requirements_____ 9. Tightly bound copy with print lost in___ spine 10. Computer printout pages with indistinct print. 11. Page(s)___________ lacking v/hen material received, and not available from school or author. 12. Page(s)___________ seem to be missing in numbering only as text follows. 13. Two pages numbered___________ . Text follows. 14. Curling and wrinkled pages______ 15. O t h e r ________________________________________________________________ University Microfilms International EXPORT BEHAVIOR AND INCENTIVES OF THE AGRIBUSINESS FIRMS IN THE PHILIPPINES DISSERTATION Presented in Partial Fulfillment of the Requirements for The Degree Doctor of Philosophy in the Graduate School of The Ohio State University BY Camilo Lalap Opena, M.B.A. ******* The Ohio State University 1983 Reading Committee: Approved by: Dr. Lee C. Nehrt Dr. Wesley Johnston Dr. David E. Hahn Advisor Faculty of Internationa] Dr. Charles Ingraham Business 0 Copyright by Camilo Lalap Opena 1983 To my wife Luz, and kids Aristotle and John and To my parents 11 ACKNOWLEDGEMENTS I would like to express my sincere thanks and gratitude to the following: Dr. Lee C. Nehrt, for chairing the dissertation committee, for supervision and guidance throughout the study, and for endorsing financial assistance to the World Trade Institute. The other members of my dissertation committee. Dr. Wesley Johnston, Dr. David Hahn and Dr. Charles Ingraham, for their valuable comments and suggestions. Director Robert Keller and the World Trade Institute for financial support for the study. The Board of Investments of the Philippines, for the list of registered exporters and endorsements to the firms. Dean Pedro Sandoval, Jimmy Williams and the faculty of the Department of Management, University of the Philippines at Los Banos, for their valuable comments and suggestions. Dr. Robert Nygren and Fred Ruland for the statistical consultation and computer programs. Marjorie King, Cindy Coykendale and Mary Anne Herbst for the kind assistance on daily routines of the Ph.D. program. Dr. Uche Okeafor, Don Howard and Fred Westfall for making the office life friendly and enjoyable. Mr. Frank Turma for editing the dissertation. And finally, to my wife and kids and the whole Opena and Banayo Family, for the never-ending inspiration and moral support. Thanks to all. VITA July 15 , 1949............ Born - Batangas, Philippines 1970.................... Bachelor of Science In Agri­ business, University of the Philippines 1970-1971 ................ Research Assistant, National Research Council of the Philip­ pines 1972 .................... Instructor, University of the Philippines at Los Banos 1973-1974 ................ Scholar, Southeast Asian Regional Center for Graduate Studies in Agriculture (SEARCA) 1974.................... Master in Agribusiness Management, University of the Philippines 1975-1978 ................ Assistant Professor, University of the Philippines at Los Banos 1978-1981 ................ World Bank Scholar, The Ohio State University, Columbus, Ohio 1981-1982 ................ Graduate Teaching Associate, The Ohio State University, Columbus, Ohio 1982 .................... M.B.A. The Ohio State University, Columbus, Ohio FIELDS OF STUDY Major Field: International Business Minor Field: Agribusiness Management Studies in International Business. Professors David Ricks, Riad Ajami and Robert Driskill Studies in Agribusiness Management. Professors David Hahn, Mike Woolverton and Charles Ingraham Studies in Marketing. Professors Michael Czinkota, James Robeson and Donald Larson. iv TABLE OF CONTENTS Page ACKNOWLEDGMENTS................................ i ü VITA.......................................... iv LIST OF TABLES..................-............. vii CHAPTER I. INTRODUCTION....................... .. 1 Background...................... .. 1 Statement of the Problem............ 19 Limitations of the Study..... 22 Possible Contributions of the Study, 24 Organization of the Study.. 26 II. REVIEW OF LITERATURE.......... 28 Overview...................... 28 Export Incentive Studies... 29 Export Behavior Studies.....,.,.... 40 Export Studies in the Philippines.., 53 Summary................... 57 III. RESEARCH DESIGN.............. 59 Overview ..... 59 Scope of the Study......... 60 The Availability of Incentives Criterion......... 61 The Status of Exporting Activity Criterion.................... .. 62 The Size Critertion........ 63 The Type of Industry Criterion,..,.. 64 The Questionnaires......... 66 Hypotheses................. ...... 73 The Universe of Concern...,..... 79 The Target Group............................ 80 Data Collection............................. 81 Data Analysis,................ 83 TABLE OF CONTENTS (conf'd) CHAPTER Page IV. RESULTS AND IMPLICATIONS................... 8 7 Overview................................. 8 7 MANOVA Results on Incentives......... 88 MANOVA Results on Status of Exports.... 102 MANOVA Results on Type of Industry 108 MANOVA Results on Size............... 115 Chi-Square Test Results.................. 124 V. SUMMARY AND CONCLUSIONS................... 131 Summary. ............................. 131 Conclusions of the Research.............. 132 Contributions of the Study to Literature............................ 138 Contributions of the Study to Philippine Policy..................... 139 Areas for Future Research................ 141 APPENDICES........................................... 144 A. Investment Incentives Act......... 145 B. Export I::; ontives Act...... 149 C. Questionnaires.................... 157 BIBLIOGRAPHY......................................... 167 VI LIST OF TABLES Table Page 1. Principal Exports of the Philippines...... 3 2. Leading Exports of Non-Traditional Manufacturers......................... 5 3. Traditional Exports of the Philippines 6 4. Exports of Non-Traditional Manufactures.... 7 5. Exports of Processed Foods................ 11 6. Handicrafts Exports by Type of Product 12 7. Top Export Markets for Philippine Products. 13 8. Foreign Trade of the Philippines.......... 15 9a. Results of Hypothesis Testing............. 87 9b. Cell Means for Individual Factors......... 88 10. Perceived Exporting Effects............... 91 11. Perceived Processing Effects.............. 91 12. Perceived Export Motivators (Initial Exporting)............................ 92 13. Perceived Export Motivators (Present Exporting)............................ 94 14. Perceived Export Obstacles (Initial Exporting)............................ 95 15. Perceived Export Obstacles (Present Exporting)............................ 96 16. Perceived Role of Export Incentives on Export Activity Decisions............. 98 17. Perceived Importance of Market Groups 99 18a. Results of Hypothesis Testing............. 102 18b. Cell Means for Status of