Does Trade Liberalization Increase Average Plant Productivity?

Timothy Kehoe, Pau Pujolas and Wyatt Brooks ()

No 578, 2014 Meeting Papers from Society for Economic Dynamics

Abstract: In the standard heterogeneous firm model of Hopenhayn (1992) and Melitz (2003), more efficient firms export and trade liberalization leads to higher average efficiency among firms. In data for Columbian plants 1981–1991, we see that the average level of productivity among exporters is higher than that among non exporters and that trade liberalization led to an increase in average firm productivity. Are there facts in the data explained by the Hopenhayn-Meltiz model? The measure of product in the data differs from the measure of efficiency in the model. In fact, in a calibrated version of the Hopenhayn-Meltiz model, the average level of productivity among exporters is lower than that among non exporters and trade liberalization leads to an increase in average firm productivity. The impact of trade liberalization on productivity is a puzzle for the standard model.

Date: 2014
New Economics Papers: this item is included in nep-eff and nep-int
References: Add references at CitEc
Citations:

Downloads: (external link)
https://red-files-public.s3.amazonaws.com/meetpapers/2014/paper_578.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:red:sed014:578

Access Statistics for this paper

More papers in 2014 Meeting Papers from Society for Economic Dynamics Society for Economic Dynamics Marina Azzimonti Department of Economics Stonybrook University 10 Nicolls Road Stonybrook NY 11790 USA. Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann ().