Escaping Import Competition in China
Ana Cecília Fieler and
Ann Harrison ()
No 24527, NBER Working Papers from National Bureau of Economic Research, Inc
In a stylized model, firms differentiate their products to escape import com- petition. Facing a nested CES demand, each firm chooses between a nest with competitors and its own nest under higher costs. The profit from differentiation is an inverted U-shaped function of firm productivity. It increases with import competition and is lower than the social benefit. Differentiation increases the gains from trade. In establishment data from China spanning its 2001 WTO accession, tariff cuts are associated with increases in productivity, introduction of new goods, switches to skill-intensive sectors. Markups in the model explain the large increases in revenue productivity among small firms and input suppliers.
JEL-codes: F12 F13 F14 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-cna and nep-int
Note: EEE ITI
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
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:nbr:nberwo:24527
Ordering information: This working paper can be ordered from
Access Statistics for this paper
More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().