The Impact of Input and Output Tariffs on Firms' Productivity PDF Download

Author: Tuan Anh Luong
Publisher:
ISBN:
Category :
Languages : en
Pages : 0

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Book Description
This paper studies the impact of trade liberalization on productivity. It shows that when intermediate inputs are not highly differentiated, lowering input tariffs leads to a rise in within-firm productivity and wages, and lowering output tariffs has the opposite effect. When intermediate inputs are highly differentiated, the conclusions reverse. These predictions are supported by the data, given by the industrial survey from INEGI (Mexico's Insitituto Nacional de Estadistica Geografia e Informacion) in the period 1984-90. The paper yields estimates for the elasticity of substitution among intermediate inputs, which are useful in determining the direction of the impact of trade liberalization. These estimates can be used to assess the gains from trade liberalization.

Author: Mr.JaeBin Ahn
Publisher: International Monetary Fund
ISBN: 1475525311
Category : Business & Economics
Languages : en
Pages : 31

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Book Description
This paper reassesses the impact of trade liberalization on productivity. We build a new, unique database of effective tariff rates at the country-industry level for a broad range of countries over the past two decades. We then explore both the direct effect of liberalization in the sector considered, as well as its indirect impact in downstream industries via input linkages. Our findings point to a dominant role of the indirect input market channel in fostering productivity gains. A 1 percentage point decline in input tariffs is estimated to increase total factor productivity by about 2 percent in the sector considered. For advanced economies, the implied potential productivity gains from fully eliminating remaining tariffs are estimated at around 1 percent, on average, which do not factor in the presumably larger gains from removing existing non-tariff barriers. Finally, we find strong evidence of complementarities between trade and FDI liberalization in boosting productivity. This calls for a broad liberalization agenda that cuts across different areas.

Author: Wei Tian
Publisher: Springer Nature
ISBN: 9819975999
Category : Business & Economics
Languages : en
Pages : 293

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Book Description
This book focuses on input trade liberalization in China and discusses the underlying causes and profound effects of Chinese enterprises facing import liberalization of intermediate input. The content of this book includes ten chapters. The analysis of this book mainly uses academic research, with policy study for a few chapters. Most chapters in this book apply the standard method of contemporary economic systems, integrating into the most advanced economic theories of international trade. The author uses theoretical models to obtain predictions which receive empirical support and carries out strict empirical research using data of China's manufacturing enterprises and China's customs to analyze the causes which affect Chinese enterprises facing import liberalization of intermediate input after China’s reform and opening-up. The suggested readership would be the public who are willing to understand the issues closely related to China’s input trade liberalization and opening-up policy, and basic knowledge in economics would be necessary in understanding the academic research part of the book. Meanwhile, this book is also specifically compelling to business persons and policy makers in that it enables deeper understanding on issues about outward foreign investment of enterprises and China’s opening-up policy and facilitates their decision-making process.

Author: Mary Amiti
Publisher: INTERNATIONAL MONETARY FUND
ISBN: 9781451861655
Category :
Languages : en
Pages : 34

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Book Description
This paper estimates the effects of trade liberalization on plant productivity. In contrast to previous studies, we distinguish between productivity gains arising from lower tariffs on final goods relative to lower tariffs on intermediate inputs. Lower output tariffs can produce productivity gains by inducing tougher import competition whereas cheaper imported inputs can raise productivity via learning, variety, or quality effects. We use Indonesian manufacturing census data from 1991 to 2001, which includes plant-level information on imported inputs. The results show that the largest gains arise from reducing input tariffs. A 10 percentage point fall in output tariffs increases productivity by about 1 percent, whereas an equivalent fall in input tariffs leads to a 3 percent productivity gain for all firms and an 11 percent productivity gain for importing firms.

Author: Miaojie Yu
Publisher:
ISBN:
Category :
Languages : en
Pages : 0

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Book Description
This paper explores how reductions in tariffs on imported inputs and ጿinal goods affect the productivity of large Chinese trading ጿirms, with the special tariff treatment that processing fiijrms receive on imported inputs. Firm-level input and output tarffs are constructed. Both types of tariff reductions have positive impacts on productivity that are weaker as ጿirms ņshare of processing imports grows. The impact of input tariff reductions on productivity improvement, overall, is weaker than that of output tari¤ reductions, although the opposite is true for non- processing ጿirms only. Both tariff reductions are found to contribute at least 14.5% to economy-wide productivity growth.

Author: Chin Hee Hahn
Publisher: Routledge
ISBN: 1000281205
Category : Business & Economics
Languages : en
Pages : 325

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Book Description
This book examines driving factors and the effects of globalisation on economic development through firm and product-level data. The book is organised into four themes, i.e., productivity, innovation, wage and income gap, and within-firm reallocation of resources. The comprehensiveness and richness of firm and product-level data shed light upon the channels through which trade and investment affect firms’ competitiveness and unveil factors shaping firms’ heterogeneous responses towards globalisation. The book looks at Asian economies as well as Australia and how they have experienced substantial structural change and become more integrated into the global economy and will be a useful reference for those who are interested in learning more about the relationship between globalisation and firm performance. This book will appeal to policy makers and researchers interested in the impact of globalisation on firm performance.

Author: Davide Furceri
Publisher: International Monetary Fund
ISBN: 1484394895
Category : Business & Economics
Languages : en
Pages : 57

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Book Description
We study the macroeconomic consequences of tariffs. We estimate impulse response functions from local projections using a panel of annual data that spans 151 countries over 1963-2014. We find that tariff increases lead, in the medium term, to economically and statistically significant declines in domestic output and productivity. Tariff increases also result in more unemployment, higher inequality, and real exchange rate appreciation, but only small effects on the trade balance. The effects on output and productivity tend to be magnified when tariffs rise during expansions, for advanced economies, and when tariffs go up, not down. Our results are robust to a large number of perturbations to our methodology, and we complement our analysis with industry-level data.

Author: Johannes Eugster
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 33

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Book Description
This paper empirically investigates the impact of tariffs when production is organized in global value chains. Using global input-output matrices, we construct four different tariff measures that capture the direct and indirect exposure to tariffs at different stages of the production chain for a broad set of countries and industries. Our results suggest that tariffs have significant effects on economic outcomes, including on countries and sectors not directly targeted. We find that tariffs higher up and further down in the value chain depress value added, employment, labor productivity and total factor productivity to varying degrees. We find no benefits for the sector that enjoys additional protection, yet there is some evidence of economic activity being diverted, i.e. positive effects on value added and employment from tariffs imposed on competitors. Our paper relates to recent innovations in theoretical gravity models and provides an empirical assessment of possible long-term effects of recent trade tensions.

Author: Sergii Meleshchuk
Publisher: International Monetary Fund
ISBN: 1513545272
Category : Business & Economics
Languages : en
Pages : 35

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Book Description
In this paper we demonstrate the importance of distinguishing capital goods tariffs from other tariffs. Using exposure to a quasi-natural experiment induced by a trade reform in Colombia, we find that firms that have been more exposed to a reduction in intermediate and consumption input or output tariffs do not significantly increase their investment rates. However, firms’ investment rate increase strongly in response to a reduction in capital goods input tariffs. Firms do not substitute capital with labor, but instead also increase employment, especially for production workers. Reduction in other tariff rates do not increase investment and employment. Our results suggest that a reduction in the relative price of capital goods can significantly boost investment and employment and does not seem to lead to a decline in the labor share.

Author: Fabrice Defever
Publisher:
ISBN:
Category :
Languages : en
Pages :

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Book Description
We investigate theoretically and empirically the role of wholesalers in mediating the productivity effects of trade liberalization. Intermediaries provide indirect access to foreign produced inputs. The productivity effects of input tariff cuts on firms that do not directly import therefore depends on the extent that wholesalers are a feature of input supply within an industry. Using firm level data from China, we document that wholesalers play no such role for direct importers. However, other firms experience productivity gains from reducing input tariffs if trade intermediation of foreign inputs within their sector is high. They suffer efficiency losses otherwise.