Do all imports matter for productivity? Intermediate inputs vs capital goods

Caselli, Mauro

doi:10.1007/s40888-017-0071-5

Cited by 29 publications

(30 citation statements)

References 28 publications

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“…Customized inputs are technologically intensive, while their use is systematically associated with a strategic tendency to upgrade product characteristics (Caselli, 2018). Overall, the use of customized inputs as a channel of product differentiation enhances productivity through the amount of tacit knowledge embodied in these inputs (Bas and Strauss-Khan, 2014;.…”

Section: Vertical Forward Spillovers: the Role Of Direct Linkages And Customizedmentioning

confidence: 99%

Multinationals and Domestic TFP: Market Shares, Agglomerations Gains and Foreign Ownership

2021

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We revisit the puzzle regarding the role of Multinational Enterprises (MNEs) on Total Factor Productivity (TFP) of domestic firms by drawing attention to foreign ownership structure. First, we differentiate between market share (MS) due to competition effects and knowledge agglomeration gains (AG). The former induces market pressure, due to foreign presence, and makes domestic firms to charge lower price mark-ups. Second, we investigate whether intraindustry (horizontal) and inter-industry (vertical) spillovers vary with the degree of foreign control. Using a sample of manufacturing firms from six European countries, we find that higher presence of MNEs in the domestic market makes domestic firms to charge lower markups. Only majority and wholly-owned MNEs generate statistically significant horizontal spillovers. The economic size of these spillovers is low. We also detect backward spillovers from MNEs in downstream industries. However, forward spillovers from MNEs in upstream industries are negative. When we control for absorptive capacity, direct linkages with MNEs, scope of product differentiation and geographical proximity, the economic size of AG increases substantially.

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Section: Vertical Forward Spillovers: the Role Of Direct Linkages And Customizedmentioning

confidence: 99%

Multinationals and Domestic TFP: Market Shares, Agglomerations Gains and Foreign Ownership

2021

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“…(2) based on the logittruncated NB-II hurdle model and markups estimated either via the translog production function (first two columns) or the Cobb-Douglas production function (last two columns). The table shows two-step block bootstrapped standard errors to obtain unbiased and consistent estimates of the standard errors in the presence of generated variables, such as markups, the measure of uncertainty and productivity (Ashraf and Galor, 2013;Caselli, 2018). Table 2 shows that the dummy for irreversibility is positive and statistically significant in all regressions.…”

Section: Econometric Analysismentioning

confidence: 99%

Markups and markdowns

2018

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h i g h l i g h t s • We investigate the high incidence of firms displaying markups lower than unity. • We use a large sample of French manufacturing firms for the period 1990-2007. • We estimate firm-level markups and document the extent of negative price-cost margins. • We analyse some mechanisms behind the persistence of negative price-cost margins. • Irreversibility and size are positively related to negative price-cost margins.

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“…For example, Van Biesebroeck ( 2005 ), De Loecker ( 2007 , 2013 ) and De Loecker and Warzyniski ( 2012 ) only consider the role of the exporting status in the evolution of TFP; and, Kasahara and Rodrigue ( 2008 ) and Halpern et al ( 2015 ) only analyse the role of importing inputs. The literature that considers the impact of both exporting and importing on TFP is scarce (see, for example, Tomiura 2007 ; Bernard et al 2009 ; Haller 2012 ; Kasahara and Lapham 2013 ; and, Caselli 2018 ). Empirical evidence indicates that exports and imports are correlated (Máñez et al 2020 ).…”

Section: Introduction and Literature Reviewmentioning

confidence: 99%

“…First, if importing intermediates results in lower input costs, and this cost reduction is at least partially transmitted to prices, this could enhance firms’ international competitiveness. Second, importing could allow firms to access a broader range of inputs, technology embedded in intermediate inputs, or higher quality inputs, which could contribute to upgrading the quality of the firms' existing product portfolio and/or facilitate the introduction of new products (Caselli 2018 ). All this can open up new opportunities for firms in export markets (Goldberg et al 2010 ; Fernandes and Paunov 2013 ; Bas and Strauss-Kahn 2015 ; Fieler et al 2018 ; and, Feng et al 2016 ).…”

Section: Introduction and Literature Reviewmentioning

confidence: 99%

Firm productivity gains in a period of slow trade liberalization: evidence from Brazil

et al. 2020

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Existing literature recognizes the possible role of trade policy and firms’ exposure to international trade as determinants of productivity. A strand of the literature sheds light on the effects of trade policy changes on firm-level productivity. Another strand studies the relationship between firms’ trade status (exporting production or importing intermediates, but usually not both simultaneously) and firm-level TFP dynamics. However, the analyses that integrate both strands are scarce. This paper aims to disentangle the impact of input and output tariffs on firms’ productivity. Further, it analyses whether the impact of changes in tariffs is conditioned by the trade status of the firm (exporting and/or importing). At difference to most previous papers, we carry out our analysis for a large developing country in a period of slow trade liberalization. Thus, in the empirical part, we use data from firms belonging to Brazilian industrial sectors (manufacturing and mining) during 2000–2008. After estimating total factor productivity (TFP) at the firm level using updated methodologies, we estimate both the impact of trade policy and firms’ trade status on TFP dynamics. Our results suggest that trade liberalization (through reductions in input or output tariffs) increases TFP, being the effect associated to a reduction in input tariffs greater. Furthermore, the impact of trade policy on TFP spreads among all firms, which could be consistent with the existence of spillovers from trading firms to non-trading firms or with the notion that trade liberalization exerts competitive pressure on all firms, regardless of their initial exposure to international trade. Finally, we also find evidence of a positive effect of both the import and export statuses on TFP.

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Do all imports matter for productivity? Intermediate inputs vs capital goods

Cited by 29 publications

References 28 publications

Multinationals and Domestic TFP: Market Shares, Agglomerations Gains and Foreign Ownership

Multinationals and Domestic TFP: Market Shares, Agglomerations Gains and Foreign Ownership

Markups and markdowns

Firm productivity gains in a period of slow trade liberalization: evidence from Brazil

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