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Does Rising Import Competition Harm Local Firm Productivity in Less Advanced Economies? Evidence from Vietnam's Manufacturing Sector

Tinh Doan, Son Nguyen, Tuyen Tran, Huong Vu and Steven Lim
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Son Nguyen: VNU University of Economics and Business
Huong Vu: University of Waikato
Steven Lim: University of Waikato

Working Papers in Economics from University of Waikato

Abstract: This paper examines whether rising import penetration has an effect on the productivity of domestic firms. The study uses data on a 10-year unbalanced panel of firms in the manufacturing sector in Vietnam from 2000 to 2009. Panel and instrumental variable methods are used to control for firm heterogeneity and endogeneity of import penetration. We find significantly negative effects of import competition on local firms’ productivity. Further investigation on the basis of firm size and industry technology levels shows that SMEs are more adversely affected, but that industry technology level does not matter.

Keywords: import penetration; productivity; Vietnam (search for similar items in EconPapers)
JEL-codes: F19 L25 P45 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2014-07-11
New Economics Papers: this item is included in nep-bec, nep-com, nep-cse, nep-eff, nep-int, nep-sea and nep-tra
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Journal Article: Does rising import competition harm local firm productivity in less advanced economies? Evidence from the Vietnam's manufacturing sector (2016) Downloads
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