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Due primarily to the small number of Swedish foreign investors (but also to their product heterogeneity) an intra-industry analysis can only be carried out within rather broad industry categories and with a very small number of independent variables. The industry categories correspond to 2-3 digit SNI groupings. Six of the 10 industry groupings distinguished correspond to the (2 digit SEe) industry classification used by Horst in the abovementioned study.l Three are combinations of 2 and 3 digit SNI groups (clothing, chemicals and other manufactures) and a final category is made up of highly diversified firms which cannat be fitted inta any of the other industry groupings. 2 Even with such a crude industry classification the number of observations in some industries is so small as to make the results rather volatile. On1y four industry groups cantain 13 or more observations and of these perhaps on1y one is a relatively homogeneous industry, namely, the c10th; ng i ndustry. Therefore, i t i. s al so debatabl e whether one i s rea lly using a very meanfngful measure of industry affil i.ationo Table 6:3 shows the results of regressing firm size (SH)' measured as volume of domestic sales, on the volume of exports (Sx) and foreign production (SQ) both overall and by industry. The product diversification measure (Divo) is included to take account of inter- and intra-industry diversification. The expected influence of this variable is negative, while the expected inf1uence of firm size is positive. Since the regressions are (again) in double logarithmic form, the coefficients are elasticities. For size to be associated with a higher propensity to sell and to produce abroad the elasticity of exports and foreign production with respect to size must be greater than unity. l
Horst, who had 20 industries, noted that there was no significant difference between using 2 and 3 digit SEe classifications. 2 Firms are defined as diversified when their output in any one 2 or 3 digit industry does not amount to at least 60 per cent of their total output.