Does input-trade liberalization affect firms' foreign technology choice?
Maria Bas and
Antoine Berthou ()
Additional contact information
Maria Bas: CES - Centre d'économie de la Sorbonne - CNRS - Centre National de la Recherche Scientifique - UP1 - Université Panthéon-Sorbonne
Post-Print from HAL
This paper studies the impact of input-trade liberalization on firms' decision to upgrade foreign technology embodied in imported capital goods. Our empirical analysis is motivated by a simple theoretical framework of endogenous technology adoption, heterogeneous firms and imported inputs. The model predicts a positive effect of input tariff reductions on firms' technology choice to source capital goods from abroad. This effect is heterogeneous across firms depending on their initial productivity level. Relying on India's trade liberalization episode in the early 1990s, we demonstrate that the probability of importing capital goods is higher for firms producing in industries that have experienced greater cuts on tariffs on intermediate goods. Only those firms in the middle range of the initial productivity distribution have benefited from input-trade liberalization to upgrade their technology. JEL classification: F10, F12 and F14.
Keywords: firms' decision to import capital goods; Input-trade liberalization; firm heterogeneity and Indian firm-level data (search for similar items in EconPapers)
Note: View the original document on HAL open archive server: https://hal-paris1.archives-ouvertes.fr/hal-01387558
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Published in World Bank Economic Review, Oxford University Press (OUP), 2017, 31 (2), pp.351-384. ⟨10.1093/wber/lhw062⟩
Downloads: (external link)
Journal Article: Does Input-Trade Liberalization Affect Firms’ Foreign Technology Choice? (2017)
Working Paper: Does input-trade liberalization affect firms' foreign technology choice? (2016)
Working Paper: Does input-trade liberalization affect firms'foreign technology choice ? (2016)
Working Paper: Does Input-Trade Liberalization Affect Firms' Foreign Technology Choice? (2013)
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:hal:journl:hal-01387558
Access Statistics for this paper
More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().