Import Competition, Heterogeneous Preferences of Managers, and Productivity

Chen, Cheng; Steinwender, Claudia

doi:10.3386/w25539

Cited by 13 publications

(12 citation statements)

References 47 publications

(76 reference statements)

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“…Although the escape-competition effect and the preference effect both imply a positive innovation response to import competition, the former effect is increasing in a firm's initial productivity, whereas the latter effect is decreasing in a firm's initial productivity (Aghion et al, 2001;Bombardini et al, 2017;Chen & Steinwender, 2017). Initially more productive firms are closer to the technological frontier and thus have stronger incentives to escape competition.…”

Section: Impact Of Import Competition On Firm Productivity and Innovamentioning

confidence: 99%

“…Autor et al (2017),Akcigit et al (2017), andBloom et al (2018) provide informal discussions that focus on reconciling the differential findings between Europe and Northern America.6 Using data on Spanish firms,Chen & Steinwender (2017) provide support for the preference effect by showing that import competition has a positive effect only on initially unproductive family firms and not on professionally managed firms.…”

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confidence: 98%

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The Impact of Trade Liberalization on Firm Productivity and Innovation

Shu

Steinwender

2019

Innovation Policy and the Economy

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149

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van Reenen, and participants at the NBER conference on Innovation Policy and the Economy. Leo Ortega Moncada provided excellent research assistance. All errors are our own. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peer-reviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

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Section: Impact Of Import Competition On Firm Productivity and Innovamentioning

confidence: 99%

mentioning

confidence: 98%

The Impact of Trade Liberalization on Firm Productivity and Innovation

Shu

Steinwender

2019

Innovation Policy and the Economy

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149

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“…As a robustness check we also develop a control variable for changes to Spain's import tariffs that may have affected the cost of importing from lower-income countries or the opening of affiliates in lower-income countries. We follow the method used by Chen and Steinwender (2019), which exploits the fact that tariffs for Spain are set at the EU level and hence plausibly exogenous. We construct two industry-year level variables for MFN import tariffs on goods in the same industry Notes: This table shows the total number of firms, the total number of employees, the sum of the value added, production and exports of all firms in the sample, broken down by whether or not they use robots, CNC machines and FMS, in a given time period.…”

Section: Import Tariff Controlsmentioning

confidence: 99%

Automation, Trade and Multinational Activity: Micro Evidence from Spain

Stapleton

Webb

2020

SSRN Journal

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We use a rich dataset of Spanish manufacturing firms from 1990 to 2016 to shed new light on how automation in a high-income country affects trade and multinational activity involving lower-income countries. We exploit supply-side improvements in the capabilities of robots over time, as described in patents, that made it technically feasible to automate some specific tasks. We show that, contrary to the speculation that automation will cause reshoring, the use of robots in Spanish firms actually had a positive impact on their imports from, and number of affiliates in, lower-income countries. Robot adoption causes firms to expand production, increase productivity and makes them more likely to start importing from, or opening affiliates in, lower-income countries. The sequencing of automation and offshoring has important consequences for the impact of automation, however. For firms that had not already offshored to lower-income countries, robot adoption made them more likely to start doing so. By contrast, for firms that were already offshoring to lower-income countries, robot adoption had no effect on their value of imports from lower-income countries, but decreased their share of imports sourced from lower-income countries. We show that these findings can be explained in a framework that incorporates firm heterogeneity, the choice between automation, offshoring and performing tasks at home and where automation and offshoring both involve upfront fixed costs, such that their sequencing matters.

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“…This paper also adds to recent research on the impact of trade liberalization on the organization of production inside firms. Evidence indicates that trade reforms incentivize firms to change the number of management layers, adjust the number and wages of managers and workers along the occupational hierarchy, and upgrade management practices (Caliendo and Rossi-Hansberg, 2012;Caliendo, Monte, and Rossi-Hansberg, 2017;Chakraborty and Raveh, 2018;Chen and Steinwender, 2016). At the same time, improved access to imported inputs is important to the product quality, product scope and export success of firms in developing countries, because of the limited domestic supply of high-quality specialized inputs and equipment (Goldberg, Khandelwal, Pavcnik, and Topalova, 2010;Fieler, Eslava, and Xu, 2018;Manova and Zhang, 2012).…”

Section: Introductionmentioning

confidence: 99%