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Author: Kaiji Gong Publisher: ISBN: Category : Languages : en Pages :
Book Description
This dissertation explores the determinants of firms' productivity growth and innovation activities. The first chapter studies the local technology spillover effects originated from multinational firms' innovation activities. The second chapter discusses the impact of import competition from China on U.S. firms' innovation activities. The third chapter introduces a new measure of firm-level regulation, and examines the consequences of rising regulation intensity in the U.S. on firms' production choices. Chapter 1 identifies the causal impact of U.S. multinationals' technology advances on their subsidiaries and the nearby domestic firms' productivity in China. By combining firm-level panel data from both the U.S. and China, I match U.S. multinationals with their manufacturing subsidiaries in China and measure the multinationals' technology stocks based on their patenting activities. To address potential endogeneity concerns, I introduce an instrumental variable strategy based on the U.S. state level R& D tax credit policies. I find multinationals' technology improvements induce increase in the output and total factor productivity (TFP) of both their subsidiaries and domestic firms in local areas. The magnitude of technology spillovers hinges on local firms' absorptive capacities, and their technological connections to the multinationals. Chapter 2 (co-authored with Rui Xu) analyzes the impact of rising import competition from China on U.S. innovative activities. Using Compustat data, we find that import competition induces R& D expenditures to be reallocated towards more productive and more profitable firms within each industry. Such reallocation effect has the potential to offset the average drop in firm-level R& D identified in the previous literature. Indeed, our quantitative analysis shows no adverse impact of import competition on aggregate R& D expenditures. Taking the analysis beyond manufacturing, we find that import competition has led to reallocation of researchers towards booming service industries, including business and repairs, personal, and financial services. Chapter 3 (co-authored with Constantine Yannelis) introduces a new measure of firm-level regulation. We find that more regulation increases labor and capital inputs. Productivity decreases, which is consistent with a model of regulation inducing non-productive investment. We employ two empirical strategies to identify the causal impact of regulation on firms, first, utilizing structural breaks and industry level regulation changes, and second, computing predicted industry level regulation measures as instruments. We conduct an event study using the surprise 2016 US election results. Firms with higher Dodd-Frank exposure exhibited higher returns following an increase in the probability of repeal.
Author: Kaiji Gong Publisher: ISBN: Category : Languages : en Pages :
Book Description
This dissertation explores the determinants of firms' productivity growth and innovation activities. The first chapter studies the local technology spillover effects originated from multinational firms' innovation activities. The second chapter discusses the impact of import competition from China on U.S. firms' innovation activities. The third chapter introduces a new measure of firm-level regulation, and examines the consequences of rising regulation intensity in the U.S. on firms' production choices. Chapter 1 identifies the causal impact of U.S. multinationals' technology advances on their subsidiaries and the nearby domestic firms' productivity in China. By combining firm-level panel data from both the U.S. and China, I match U.S. multinationals with their manufacturing subsidiaries in China and measure the multinationals' technology stocks based on their patenting activities. To address potential endogeneity concerns, I introduce an instrumental variable strategy based on the U.S. state level R& D tax credit policies. I find multinationals' technology improvements induce increase in the output and total factor productivity (TFP) of both their subsidiaries and domestic firms in local areas. The magnitude of technology spillovers hinges on local firms' absorptive capacities, and their technological connections to the multinationals. Chapter 2 (co-authored with Rui Xu) analyzes the impact of rising import competition from China on U.S. innovative activities. Using Compustat data, we find that import competition induces R& D expenditures to be reallocated towards more productive and more profitable firms within each industry. Such reallocation effect has the potential to offset the average drop in firm-level R& D identified in the previous literature. Indeed, our quantitative analysis shows no adverse impact of import competition on aggregate R& D expenditures. Taking the analysis beyond manufacturing, we find that import competition has led to reallocation of researchers towards booming service industries, including business and repairs, personal, and financial services. Chapter 3 (co-authored with Constantine Yannelis) introduces a new measure of firm-level regulation. We find that more regulation increases labor and capital inputs. Productivity decreases, which is consistent with a model of regulation inducing non-productive investment. We employ two empirical strategies to identify the causal impact of regulation on firms, first, utilizing structural breaks and industry level regulation changes, and second, computing predicted industry level regulation measures as instruments. We conduct an event study using the surprise 2016 US election results. Firms with higher Dodd-Frank exposure exhibited higher returns following an increase in the probability of repeal.
Author: Ishan Deep Ghosh Publisher: ISBN: Category : Economic geography Languages : en Pages : 0
Book Description
This thesis is divided in two parts: the first part investigates the role of firms in international trade and productivity growth; the second explores the changing geographical landscape of innovation and high-tech jobs in the U.S. In the first essay, I use confidential firm level data from the U.S. Census Bureau to study the causal impact of offshoring on R&D expenditures and quantify their joint impact on firm performance. I highlight two main contributions: First, by constructing a shift-share design instrument to identify exogenous variation in offshoring, I show that offshoring has a significant positive impact on domestic R&D expenditures. Second, I build and estimate a structural dynamic model of R&D investment, in which a decline in the relative cost of imported intermediates increases the firm's incentive to invest in R&D, thus endogenously leading to an increase in firm productivity. I then use the estimated model to quantify the effects of a (not so) counterfactual tariff on firm value and long-run returns to R&D. In response to a proposed 20% unilateral tariff on intermediate imports, firm value declines by 0.6% in the subsequent period, while average long-run gains from R&D decline significantly by 2.94 percentage points, owing to a decline in R&D participation by 7.1 percentage points. In light of the current political discourse on protectionist trade policies, this paper shows that identification of the offshoring driven R&D channel is fundamental to quantify the consequences of trade policies on firm performance. In the second essay, I provide external validation to the results highlighted
Author: Jan Fagerberg Publisher: Edward Elgar Publishing ISBN: 1788110269 Category : Business & Economics Languages : en Pages : 431
Book Description
This authoritative and enlightening book focuses on fundamental questions such as what is innovation, who is it relevant for, what are the effects, and what is the role of (innovation) policy in supporting innovation-diffusion? The first two sections present a comprehensive overview of our current knowledge on the phenomenon and analyse how this knowledge (and the scholarly community underpinning it) has evolved towards its present state. The third part explores the role of innovation for growth and development, while section four is concerned with the national innovation system and the role of (innovation) policy in influencing its dynamics and responding to the important challenges facing contemporary societies.
Author: Cristiana Benedetti Fasil Publisher: ISBN: Category : Business enterprises Languages : en Pages : 96
Book Description
Recent empirical firm level studies reveal the structural heterogeneity of firms in process and product innovation, as well as the central role of product quality in determining world trade patterns and intensities. This calls for a better understanding of the link between firm heterogeneity and the innovation and export decisions of firms which are at the base of productivity growth and, hence, economic growth and development. My dissertation contributes to this debate focusing on the supply side. I propose a novel way to model the production technology of firms by introducing two attributes of firm heterogeneity: cost efficiency and product quality. The goal of the first thesis chapter is to study the effects of process and product innovation on firm dynamics, productivity and endogenous long run growth. In the second chapter an open economy framework with trade between symmetric countries is analyzed. Here the focus is on quantifying the impact of trade as well as trade liberalization on firm innovation dynamics and productivity- and aggregate growth. The third chapter abstracts from endogenous growth and examines the role of the two attributes of firm heterogeneity in shaping the trade patterns and intensities within and across developed and developing countries.
Author: Eva Vivalt Publisher: ISBN: Category : Languages : en Pages : 196
Book Description
Economic development has the potential to improve lives. Three issues that directly affect economic development are conflict, trade, and innovation, the subjects of the three chapters in this dissertation. Conflict causes enormous suffering, but the study of peacekeeping is plagued by endogeneity issues. The first chapter in this dissertation uses an instrumental variables approach to estimate the effectiveness of U.N. peacekeepers at ending episodes of conflict, maintaining the peace once peace has been obtained, and preventing another episode from ever re-occurring. I find that the likelihood of being sent U.N. peacekeepers varies with temporary membership in the U.N. Security Council and exploit this variation in my estimation. This variation also suggests that the leaders of countries in conflict often do not want their country to receive peacekeepers. The results indicate that even though peacekeepers are often unwanted, they help to maintain the peace after an episode of conflict has ended and reduce the likelihood that the conflict resumes. After peace, trade is also considered crucial to development. In the standard trade literature, more productive firms should export over less productive firms, all else equal. This premise appears in Melitz (2003), Luttmer (2007), and Eaton et al. (2009), among others. However, we know that developing countries often suffer from market distortions (Hsieh and Klenow, 2009). The theory behind the second chapter of this dissertation combines Hsieh and Klenow-like distortions with a Melitz-like model that accords productivity a key role. Under this model, firm productivity matters less in the decision to export in sectors with greater distortions and firms facing greater distortions exhibit less of the productivity-based "churning" and re-allocation that Melitz predicts. The implication is that trade is less beneficial to productivity in developing countries. These predictions are tested using plant-level data from Colombia. Finally, new products have been shown to increase welfare in a few studies. One branch of the literature has focused on estimating the welfare effects of very narrow and specific new products; another has estimated elasticities of substitution across a large number of varieties and then imputed gains from the new varieties that appear in the data. However, one might suspect that the most important innovations occurred over a much longer period of time than has been studied to date. Thus, the final chapter of my dissertation focuses on a different question. It assigns an innovation date to each good and asks the question: how would welfare be affected if one were restricted to the set of goods available at an earlier time period? I modify the methodology in Feenstra (1994) and Broda and Weinstein (2006a) to answer this question. The estimates suggest that innovations are more important to welfare than previously thought. I also find that the price index that takes varieties into consideration favoured by the literature can yield deeply misleading results.
Author: Luke Emeka Okafor Publisher: ISBN: Category : Languages : en Pages : 366
Book Description
This dissertation consists of three essays, focusing on the productivity effects of both international and innovative activities of firms and the link between financial constraints and trading behaviour.The first essay investigates whether the use of imported inputs leads to improvement in productivity. This includes examining the influence of absorptive capacity in the underlying relationship between imported inputs and productivity. This investigation uses firm-level panel data of manufacturing firms in Ghana covering the period between 1991 and 2002. Lagged relative productivity improvement (LRPI) is proposed as a new proxy for absorptive capacity (ABC). For any given period, LRPI is defined as the natural logarithm of a firm's real value added per worker in the previous period relative to the firm's initial real value added per worker. An alternative measure of ABC considers total factor productivity instead of real value added per worker. Both the direct and indirect methods of estimating production function are used. Both methods show that firms with high levels of ABC enjoy productivity benefits from the contemporaneous and past use of imported inputs. The results also suggest that firms operating in the input-intensive sectors such as machines, in addition to having high levels of ABC enjoy higher productivity benefits from the current and past use of imported inputs. The second essay examines the effect of higher participation in international activities on productivity, as well examining the effect of innovative activities on productivity. This investigation uses European firms in a global economy (EFIGE) dataset, a representative cross-country firm-level data across seven European countries: Austria, France, Germany, Hungary, Italy, Spain and the UK. Firms simultaneously engaging in a larger number of international activities gain more productivity benefits than firms involved in a smaller number. Evidence is also found that innovating internationally active firms attain higher productivity benefits than innovating domestic-focused firms. Firms that introduce new products or adopt new or improved production technologies or register industrial designs also gain substantial productivity benefits than those that do not. Evidence is also found that innovation output, broadly defined, leads to a substantial improvement in productivity for internationally active firms, whereas its effect is negative for domestic-focused firms. Domestic firms are potentially more vulnerable to the disruptive effect of innovation than internationally active firms.The third essay analyses the effect of access to credit, public financial incentives, and tax-based financial incentives on trade outcomes and foreign market participation using the same cross-country firm-level dataset employed in the second essay. Access to credit, public, or tax-based financial incentives are found to lead to a substantial improvement in a firm's export performance, and the utilization of a larger share of imported inputs or services in the production process. The effect of financial constraints is found to be size dependent. In general, medium-sized firms with access to credit, public, or tax-based financial incentives display better international trade performance than others. These results provide new evidence on the role of public and/or tax-based financial incentives in promoting internationalization.
Author: Syed Muhammad Hasan Publisher: ISBN: Category : Languages : en Pages : 108
Book Description
At the macro level financial constraints imposed by monetary policy have an overwhelming effect on growth of the domestic financial sector. Thus the reallocation of resources towards the most productive units of the economy following trade liberalization is not achieved unless the degree of credit constraints is significantly relaxed. Results show that the volume of domestic credit made available to the private sector depends on the cost of credit that is the interest rate.
Author: Kaiji Gong
Author: Kaiji Gong
Author: Aranzazú Crespo Rodríguez
Author: Siwook Lee
Author: Ishan Deep Ghosh
Author: Jan Fagerberg
Author: Cristiana Benedetti Fasil
Author: Eva Vivalt
Author: Luke Emeka Okafor
Author: Syed Muhammad Hasan
Author: Uzoamaka Chigoziri Nduka