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From Selling Goods to Selling Services: Firm Responses to Trade Liberalization

Holger Breinlich, Anson Soderbery () and Greg Wright ()

CEP Discussion Papers from Centre for Economic Performance, LSE

Abstract: In the face of trade liberalization domestic firms are often forced out of the market, whereas others adapt and survive. In this paper we focus on a new channel of adaptation, namely the shift toward increased provision of services in lieu of goods production. We exploit variation in EU trade policy to show that lower manufacturing tariffs cause firms to shift into services provision and out of goods production. Additionally, we find that a successful transition is strongly associated with higher firm-level R&D stocks whereas higher physical capital stocks slow the shift into services provision.

Keywords: Services trade; trade liberalization (search for similar items in EconPapers)
JEL-codes: F12 F15 F23 (search for similar items in EconPapers)
Date: 2014-09
New Economics Papers: this item is included in nep-int
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Related works:
Journal Article: From Selling Goods to Selling Services: Firm Responses to Trade Liberalization (2018) Downloads
Working Paper: From Selling Goods to Selling Services: Firm Responses to Trade Liberalization (2016) Downloads
Working Paper: From Selling Goods to Selling Services: Firm Responses to Trade Liberalization (2014) Downloads
Working Paper: From selling goods to selling services: firm responses to trade liberalization (2014) Downloads
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