Trade Reforms in a Global Competition Model: the Case of Chile

Alfonso A. Irarrazabal and Luca David Opromolla

No 331651, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: We use a global competition model of international trade with heterogeneous firms to evaluate the impact of trade reforms that occurred in Chile at the end of the 70s. We compare the predictions of the calibrated model in terms of productivity, plant turnover, job and trade flows with what occurred in reality using a comprehensive plant-level panel dataset for the manufacturing sector. The model explains several effects of liberalization reforms on industry performance. In contrast to the previous studies we use a general equilibrium approach that allows fully quantifying and identifying the trade liberalization effects on the tradeable and nontradeable sectors. We proceed by performing a counterfactual experiment aimed at exploring the impact of preferential trade agreements negotiated by Chile in recent years with the EU and NAFTA.

Keywords: International Relations/Trade; Productivity Analysis (search for similar items in EconPapers)
Pages: 32
Date: 2007
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Persistent link: https://EconPapers.repec.org/RePEc:ags:pugtwp:331651

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