Daniela, Maggioni (2011): Productivity dispersion and its determinants: the role of import penetration.
Download (361kB) | Preview
The new heterogeneous firm models in international economics suggest a negative impact of trade openness on the within-sector disparities, due to a restructuring process leading to a resources reallocation toward high efficient firms and the exit of less productive ones. I test this hypothesis for the Italian manufacturing sectors making use of both static and dynamic panel data models. Especially, I investigate the existence of heterogeneous effects in terms of origin of imports and I take into account of the regional heterogeneity computing the productivity dispersion indicator within each sector and regional macro-area. The analysis is implemented within a comprehensive framework controlling for other potential determinants, such as the technological factors and the domestic competition. My findings show that the competitive pressure from low income countries reduces the productivity heterogeneity across firms, while an opposing impact is detected for the exposure to trade with high income economies, and I argue that two different mechanisms are at work behind these effects.
|Item Type:||MPRA Paper|
|Original Title:||Productivity dispersion and its determinants: the role of import penetration|
|Keywords:||Productivity; Dispersion; Imports; Firm Heterogeneity|
|Subjects:||L - Industrial Organization > L2 - Firm Objectives, Organization, and Behavior > L25 - Firm Performance: Size, Diversification, and Scope
O - Economic Development, Innovation, Technological Change, and Growth > O4 - Economic Growth and Aggregate Productivity > O47 - Empirical Studies of Economic Growth ; Aggregate Productivity ; Cross-Country Output Convergence
F - International Economics > F1 - Trade > F14 - Empirical Studies of Trade
|Depositing User:||Daniela Maggioni|
|Date Deposited:||07. Mar 2012 13:00|
|Last Modified:||13. Mar 2015 15:45|
 Aghion P., Burgess R., Redding S. and F. Zilibotti (2005). Entry Liberalization and Inequality in Industrial Performance. Journal of the European Economic Association, 3(2-3), 291-302.
 Altomonte C., Barattieri A. and A. Rungi (2008). Import penetration, intermediate inputs and productivity: evidence from Italian firms. Working paper, Bocconi University, Milan.
 Amiti M. and J. Konings (2007). Trade Liberalization, Intermediate Inputs, and Productivity: Evidence from Indonesia. American Economic Review, 97(5), 1611-1638.
 Arnold J., Nicoletti G. and S. Scarpetta (2008). Regulation, Allocative Efficiency and Productivity in OECD Countries: Industry and Firm-Level Evidence. OECD Economics Department Working Papers 616, OECD, Economics Department.
 Bartelsman E.J. and M.E. Doms (2000). Understanding Productivity: Lessons from Longitudinal Microdata. Journal of Economic Literat-ure, 38(3), 569-594.
 Becchetti L. and G. Trovato (2002). The Determinants of Growth for Small and Medium Sized Firms. The Role of the Availability of External Finance. Small Business Economics, 19, 291-306.
 Beck, N. and J.N. Katz (1995). What to Do (and Not to Do) With Time-Series Cross-Section Data. American Political Science Review, 89, 634-647.
 Békés G., Kleinert J. and F. Toubal (2009). Spillovers from Multinationals to Heterogeneous Domestic Firms: Evidence from Hungary. World Economy, 32(10), 1408-1433.
 Bernard A.B., Eaton J., Jensen J.B. and S. Kortum (2003). Plants and Productivity in International Trade. American Economic Review, 93, 1268-1291.
 Bernard, A.B., Jensen, J.B., and P.K. Schott (2006). Survival of the Best Fit: Exposure to Low Wage Countries and the Growth of US Manufacturing Plants. Journal of International Economics, 68(1), 219-237.
 Bruno G. (2005). Approximating the bias of the LSDV estimator for dynamic unbalanced panel data models. Economics Letters, 87, 361-366.
 Bugamelli, M. and A. Rosolia (2006). Productivity and Foreign Competition. Bank of Italy Economic Research Paper N. 578.
 Bun, M.J.G. and J.F. Kiviet (2001). The accuracy of inference in small samples of dynamic data models. Tinbergen Institute Discussion Papers 006/4.
 Caselli F. (1999). Technological Revolutions. American Economic Review, 89(1), 78-102.
 Caves D.W., L.R. Christensen and W. E. Diewert (1982). Comparisons of Output, Input, and Productivity Using Superlative Index Numbers. Economic Journal, 92(365), 73-86.
 Chevalier P.A., Lecat R. and N. Oulton (2009). Convergence of Firm-Level Productivity, Globalisation, Information Technology and Competition: Evidence from France. CEP Discussion Paper No 916, Centre for Economic Performance.
 Daveri F. and C. Jona-Lasinio (2005). Italy's Decline: Getting the Facts Right. Giornale degli Economisti, Giornale degli Economisti e Annali di Economia, 64(4), 365-410.
 Del Gatto M., Ottaviano G.I. and M. Pagnini (2008). Openness To Trade And Industry Cost Dispersion: Evidence From A Panel of Italian Firms. Journal of Regional Science, 48(1), 97-129.
 Dimova R. (2008). The impact of labour reallocation and competitive pressure on TFP growth: firm-level evidence from crisis and transition ridden Bulgaria. International Review of Applied Economics, 22(3), 321-338.
 Dovis, M. and J. Milgram-Baleix (2009). Trade, Tariffs and Total Factor Productivity: the case of Spanish firms. The World Economy, 32(4), 575-605.
 Escribano A.S. and R. Stucchi (2008). Catching up in total factor productivity through the business cycle: evidence from Spanish manufacturing surveys. Economics Working Papers 085125, Universidad Carlos III.
 Eslava M., Haltiwanger J.C., Kugler A.D. and M. Kugler (2009). Trade Reforms and Market Selection: Evidence from Manufacturing Plants in Colombia. NBER Working Papers 14935, National Bureau of Economic Research.
 Fernandes A.M. (2007). Trade Policy, Trade Volumes and Plant-level Productivity in Colombian Manufacturing Industries. Journal of International Economics, 71(1), 52-71.
 Griffith R., Redding S. and H. Simpson (2003). Productivity Convergence and Foreign Ownership at the Establishment Level. CEP Discussion Papers 0573, Centre for Economic Performance.
 Haller S. (2008). The Distribution of Productivity in Irish Manufacturing Between 1995 and 2004 Determinants, Changes and Implications. The Economic and Social Review, Economic and Social Studies, 39(1), 13-38.
 Halpern, L., M. Koren, and A. Szeidl (2003). Imports and Productivity. CEPR Discussion Papers 5139.
 Iacovone L. (2009). The better you are the stronger it makes you: evidence on the asymmetric impact of liberalization. Policy Research Working Paper Series 4930, The World Bank.
 Ito K. and S. Lechevalier (2009). The Evolution of the Productivity Dispersion of Firms: A reevaluation of its determinants in the case of Japan. Review of World Economics, 145(3), 405-429.
 Jovanovic B. (1982). Selection and the Evolution of Industry. Econometrica, 50(3), 649-670.
 Jovanovic, B. and S. Lach (1997). Product innovation and the business cycle. International Economic Review, 38, 3-22.
 Kasahara, H., and J. Rodrigue (2008). Does the use of imported intermediates increase productivity? Plant-level evidence. Journal of Development Economics, 87(1), 106-118.
 Kiviet, J.F. (1995). On Bias, Inconsistency and Efficiency of Various Estimators in Dynamic Panel Data Models. Journal of Econometrics, 68, 53-78.
 Kiviet, J.F. (1999). Expectation of Expansions for Estimators in a Dynamic Panel Data Model; Some Results for Weakly Exogenous Regressors. In: Hsiao, C., Lahiri, K., Lee, L.F. and M.H. Pesaran (Eds.), Analysis of Panel Data and Limited Dependent Variables. Cambridge University Press, Cambridge.
 Konings, J. and H. Vandenbussche (2008). Heterogeneous responses of firms to trade protection. Journal of International Economics, 76, 371-383.
 Kremp E. and J. Mairesse (1991). Dispersion and Heterogeneity of Firm Performances in Nine French Service Industries, 1984-1987. NBER Working Papers 3665, National Bureau of Economic Research.
 Krugman, P. (1991). Increasing Returns and Economic Geography. Journal of Political Economy, 99, 483-499.
 Levinsohn J. and A. Petrin (2003). Estimating Production Functions Using Inputs to Control for Unobservables. Review of Economic Studies, 70, 317-341.
 Mairesse J. and J. Jaumandreu (2005). Panel-data Estimates of the Production Function and the Revenue Function: What Difference Does It Make? Scandinavian Journal of Economics, 107(4), 651-672.
 Maliranta M. (2005). R&D, International Trade and Creative Destruction. Empirical Findings from Finnish Manufacturing Industries. Journal of Industry, Competition and Trade, 5(1), 27-58.
 Maliranta M. and S. Nurmi (2004). Do Foreign Players Change the Nature of the Game Among Local Entrepreneurs? Discussion Papers 942, The Research Institute of the Finnish Economy.
 Melitz M.J. (2003). The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity. Econometrica, 71(6), 1695-1725.
 Muendler M.A. (2004). Trade, Technology, and Productivity: A Study of Brazilian Manufacturers, 1986-1998. Economics Working Paper Series 2004-06, University of California at San Diego.
 Ottaviano, G.I.P. and Puga, D. (1998). Agglomeration in the Global Economy: a Survey of the `New Economic Geography'. The World Economy, 21(6), 707-731.
 Oulton N. (1998). Competition and the Dispersion of Labour Productivity amongst UK Companies. Oxford Economic Papers, 50(1), 23-38.
 Pavcnik N. (2002). Trade Liberalization, Exit, and Productivity Improvement: Evidence from Chilean Plants. Review of Economic Studies, 69(1), 245-276.
 Rodrik D. (1991). Closing the technology gap: does trade liberlaization really help? NBER Working Papers 2654, National Bureau of Economic Research.
 Sabirianova, K.P., Svejnar, J. and K. Terrel (2005). Distance to the Efficiency Frontier and Foreign Direct Investment Spillovers. Journal of the European Economic Association, 3(2), 576-586.
 Schor, A. (2004). Heterogeneous Productivity Response to Tariff Reduction: Evidence from Brazilian Manufacturing Firms, Journal of Development Economics, 75(2), 373-396.
 Syverson C. (2004). Product Substitutability and Productivity Dispersion. The Review of Economics and Statistics, 86(2), 534-550.
 Topalova, P. (2004). Trade Liberalisation and Firm Productivity: The Case of India. MF Working Paper 04/28, Washington: International Monetary Fund.
 Traca D. (1997). Import-Competition, Market Power and Productivity Change. Discussion Paper FS IV 97 - 29, Wissenschaftszentrum Berlin.
 Van Biesebroeck, J. (2007). Robustness of productivity estimates. Journal of Industrial Economics, 55(3), 529-569.
 Vogel A. and J. Wagner (2010). Higher Productivity in Importing German Manufacturing Firms: Self-selection, Learning from Importing, or Both?. Review of World Economics, 145(4), 641-665.
 Wooldridge J.M. (2002). Econometric Analysis of Cross Section and Panel Data. MIT Press, Cambridge.