Trade and Market Selection: Evidence from Manufacturing Plants in Colombia
Marcela Eslava (),
Adriana Kugler and
Maurice Kugler ()
Review of Economic Dynamics, 2013, vol. 16, issue 1, 135-158
We examine the link between trade liberalization and aggregate productivity, with a focus on improved market selection resulting from a reduction in trade barriers and in the dispersion of these barriers across producers. Our analysis exploits tariff changes across sectors after the Colombian trade reform. An additional advantage of our analysis is that our TFP measure does not include demand and price effects. We find that reduced trade protection makes plant survival depend more closely on productivity. Using a dynamic simulation, we find that enhanced selection increases aggregate productivity substantially. Trade liberalization also increases productivity of incumbent plants and improves the allocation of activity. We find larger effects on allocative efficiency with our TFP measure than with a traditional measure including price effects. (Copyright: Elsevier)
Keywords: Trade liberalization; Productivity; Market selection (search for similar items in EconPapers)
JEL-codes: F43 L25 O47 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (26) Track citations by RSS feed
Downloads: (external link)
Access to full texts is restricted to ScienceDirect subscribers and institutional members. See http://www.sciencedirect.com/ for details.
Software Item: Code and data files for "Trade and Market Selection: Evidence from Manufacturing Plants in Colombia" (2012)
Working Paper: Online Appendix to "Trade and Market Selection: Evidence from Manufacturing Plants in Colombia" (2012)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:red:issued:11-69
Ordering information: This journal article can be ordered from
https://www.economic ... ription-information/
Access Statistics for this article
Review of Economic Dynamics is currently edited by Jonathan Heathcote and Vincenzo Quadrini
More articles in Review of Economic Dynamics from Elsevier for the Society for Economic Dynamics Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann ().