Trade Liberalisation and Capital Spending by US Manufacturers

Abstract

This is the first paper to study the impact of long‐term tariff reductions on capital spending by US manufacturers. We investigate fluctuations in investment for approximately 400 different four‐digit industries during the period 1974–2005. Our results indicate that the dismantling of tariff and quota protection has had a stimulatory effect on US manufacturing investment, despite the relatively low average tariff rate that existed at the start of our sample period. However, our findings reveal that reductions in input tariffs rather than output tariffs were the source of this effect, suggesting that better access to foreign inputs rather than increased foreign competition at the output level served as the primary stimulus for increased US manufacturing investment.

Dampak Liberalisasi Tarif Impor Pada Investasi Teknologi Perusahaan Manufaktur Indonesia

“…Liberalisasi tarif menyebabkan perusahaan asing masuk sehingga tingkat kompetisi meningkat. Peningkatan kompetisi mendorong perusahaan untuk meningkatkan efisiensinya melalui investasi teknologi (Iacovone, 2012;Liebman dan Reynolds, 2015;Parameswaran, 2010). Dengan mengontrol tingkat konsentrasi pasar, Parameswaran (2010) menemukan bahwa di India peningkatan kompetisi akibat liberalisasi tarif akan meningkatkan investasi teknologi hanya pada sektor dengan tingkat konsentrasi yang tinggi.…”

“…Tidak banyak penelitian terdahulu yang menguji dampak tarif terhadap investasi teknologi. Dampak tarif pada investasi teknologi pada penelitian ini memiliki hasil yang sama dibandingkan dengan hasil Iacovone (2012) dan Liebman dan Reynolds (2015). Tarif impor output berdampak negatif terhadap investasi teknologi.…”