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on International Trade |
| By: | Bellone, Flora (GREDEG-CNRS); Musso, Patrick (GREDEG-CNRS); Nesta, Lionel (GREDEG-CNRS); Warzynski, Frederic (Department of Economics, Aarhus School of Business) |
| Abstract: | In this paper, we test key micro-level theoretical predictions ofMelitz and Ottaviano (MO) (2008), a model of international trade with heterogenous firms and endogenous mark-ups. At the firm-level, the MO model predicts that: 1) firm markups are negatively related to domestic market size; 2) markups are positively related to firm productivity; 3) markups are negatively related to import penetration; 4) markups are positively related to firm export intensity and markups are higher on the export market than on the domestic ones in the presence of trade barriers and/or if competitors on the export market are less efficient than competitors on the domestic market. We estimate micro-level price cost margins (PCMs) using firm-level data extending the techniques developed by Hall (1986, 1988) and extended by Domowitz et al. (1988) and Roeger (1995) for the French manufacturing industry from 1986 to 2004. We find evidence in favor of these theoretical predictions. |
| Keywords: | Endogenous markups; Export behavior; Productivity; Firm-level |
| JEL: | D24 F12 |
| Date: | 2008–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:aareco:2008_020&r=int |
| By: | Geishecker, Ingo (Georg-August Universität Göttingen); Nielsen, Jørgen Ulff-Møller (Department of Economics, Aarhus School of Business); Pawlik, Konrad (Jagiellonian Institute) |
| Abstract: | This paper investigates the link between export performance and multinational enterprise presence utilizing trade and industry data for Polish manufacturing industries for the years 1994-2002. Decomposing trade into final and intermediate goods and assessing the impact of foreign-owned capital on the respective export performance of Polish industries, we suggest a significant role of export-platform FDI into Poland, while the importance of FDI for vertical integration is limited suggesting that the sourcing of intermediate goods from Poland primarily occurs through arm’s-length contractual outsourcing instead of in-house sourcing of multinational enterprises. The paper also suggests that over the sample period, where Poland has evolved into a relatively stable economic environment, the role of export-platform FDI has increased significantly. |
| Keywords: | Export-platform FDI; Vertically integrated multinational enterprises; Export performance; Poland; Contractual outsourcing |
| JEL: | F14 F23 |
| Date: | 2008–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:aareco:2008_028&r=int |
| By: | Claudia M. Buch; Paola Monti; Farid Toubal |
| Abstract: | Has the labor share declined? And what is the impact of international trade? These questions are not only relevant in an international context they also matter for understanding the regional distribution of incomes in a given country. In this paper, we study two regions with trade exposures that differ from the rest of the country, and which display distinct changes in the labor share. East German and Southern Italian regions have a degree of international openness which is below the countries’ averages. At the same time, there has been a more pronounced decline in the labor share in East Germany than in West Germany. In Southern Italy, the labor share has increased in recent years. We show that increased trade openness is not the main culprit behind changing labor shares. |
| Keywords: | labor share, trade, regions |
| JEL: | E25 F10 R10 |
| Date: | 2008–11 |
| URL: | http://d.repec.org/n?u=RePEc:iaw:iawdip:46&r=int |
| By: | Gormsen, Christian (Department of Economics, Aarhus School of Business) |
| Abstract: | This paper analyzes anti-dumping (AD) policies in a two-country model with heterogeneous firms in monopolistic competition. Effective AD legislation in one country imposes a no-dumping condition on firms exporting from the other country, altering their pricing both domestically and abroad. Some firms with intermediate productivities cease export activity, and entry shifts towards the AD protected country, which has now become relatively more attractive. Protecting firms with AD therefore increases the number of firms entering and eventually increases competition, and the consumers enjoy welfare gains. In the country without AD legislation, there is a welfare loss due to fewer entrants. |
| Keywords: | Trade policy; Anti-dumping; Monopolistic competition; Heterogeneous firms |
| JEL: | F12 F13 |
| Date: | 2008–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:aareco:2008_024&r=int |
| By: | De Locker, Jan (Department of Economics, Aarhus School of Business); Warzynski, Frederic (Department of Economics, Aarhus School of Business) |
| Abstract: | We derive an estimating equation to estimate markups using the insight of Hall (1986) and the control function approach of Olley and Pakes (1996). We rely on our method to explore the relationship between markups and export behavior using plant-level data. We find significantly higher markups when we control for unobserved productivity shocks. Furthermore, we find significant higher markups for exporting firms and present new evidence on markup-export status dynamics. More specifically, we find that firms’ markups significantly increase (decrease) after entering (exiting) export markets. We see these results as a first step in opening up the productivity-export black box, and provide a potential explanation for the big measured productivity premia for firms entering export markets. |
| Keywords: | Markups; Control Function; Productivity; Exporting Behavior |
| JEL: | A10 |
| Date: | 2009–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:aareco:2009_004&r=int |
| By: | Aida Caldera |
| Abstract: | This paper investigates the relationship between innovation and the export behavior of firms using data from a representative panel of Spanish firms over 1991-2002. It presents a simple theoretical model of the firm decision to export and innovate that guides the econometric analysis. Consistent with the predictions of the theoretical model, the econometric results suggest a positive effect of firm innovation on the probability of participation in export markets. The results further reveal the heterogeneous effects of different types of innovations on the firm export participation. In particular, product upgrading appears to have a larger effect on the firm export participation than the introduction of cost-saving innovations. These findings are robust to alternative regression techniques to control for firm unobserved heterogeneity, to dynamic specifications and to the use of instrumental variables regressions to control for the potential endogeneity between innovation and exporting. |
| Keywords: | Firm data, innovation, trade. |
| JEL: | F10 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:eca:wpaper:2009_014&r=int |
| By: | Hagemejer, Jan; Tyrowicz, Joanna |
| Abstract: | Literature is not clear on the eect of FDI on the economic performance in hosting countries. The analysed eects include productivity, propensity to export, access to financial markets, etc. Although foreign subsidiaries usually perform better than the average of the hosting economies, sometimes the selection eect is found to be considerable. We use a unique dataset based on accounting annual reports to the statistical authorities by all medium and large Polish enterprises over a period 1997-2006. We match firms with FDI entry and to a control group of non-foreign owned companies to disentangle the eect of self-selection and FDI entry. We also distinguish explicitly between foreign ownership and privatisation through a foreign investor. We find strong support of the view that foreign ownership increases access to financing. Evidence suggests also that although FDI enters more frequently companies who already participate in the international trading networks, while approximately 20% of the export intensity may be consistently on average attributed to the treatment effect. On the other hand, we were not able to confirm large effects on effciency not profitability, while the size of the effects are dierent for greenfield investment and private acquisitions as opposed to privatisation. |
| Keywords: | FDI; transition; propensity score matching; Poland; firm-level analysis |
| JEL: | C14 P45 O16 P52 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14934&r=int |