Automation Imports and Upgrading in Firm Production Networks

Seda Koymen Ozer (), Alessia Lo Turco and Daniela Maggioni
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Seda Koymen Ozer: Baskent University, Ankara, Turkey

No 495, Working Papers from Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali

Abstract: We investigate how the import of automation impacts upgrading within firm production networks. We use comprehensive data on product mix, foreign trade, balance sheets, employment, and firm-to-firm transactions for Turkish manufacturing firms from 2009 to 2020. By employing Propensity Score Matching (PSM) alongside event study analyses and an instrumental variable (IV) approach, our research provides robust evidence that firms importing automation enhance the quality and lower quality-adjusted prices of their products. Importantly, the benefits of automation extend downstream throughout the supply chain to firms sourcing inputs from suppliers that have adopted automation. No significant effects propagate, instead, to upstream firms supplying automation adopters.

Keywords: buyer-supplier links; product upgrading; manufacturing; Turkiye (search for similar items in EconPapers)
JEL-codes: F61 F63 O14 (search for similar items in EconPapers)
Pages: 41
Date: 2025-03
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