Author: Siwook LeePublisher:
ISBN:
Category :
Languages : en
Pages : 258
Book Description
Three Essays on International Trade and Productivity
Author: Siwook LeeThree Essays on International Trade and Productivity
Author: Michael James NowerThree Essays on International Trade and Regional Productivity
Author: Hanpil MoonPublisher:
ISBN:
Category : Industrial productivity
Languages : en
Pages : 258
Book Description
A firm's productivity is composed of two parts: pure technical change and location-specific (agglomeration) externalities. Regional productivity is thus an aggregation of productivity of firms producing similar goods and located in a given region. International trade can affect both components of regional productivity. First, trade openness in a closed economy may alter its internal economic geography. Some regions which become more attractive to firms than before gain an advantage over others from integration into global markets. Second, as a competition pressure, trade liberalization forces the least productive firms to exit, resulting in the growth of aggregate productivity in the industry. The three essays presented in this dissertation explore the relationship between international trade and regional productivity in the presence of heterogeneous firms. In the first essay, a theoretical framework is introduced in order to describe how the above two channels, through which trade affects regional productivity, shape a country's spatial distribution of productivity. Results show that industries, each having its own cost-minimizing location, can be spatially relocated within a country via heterogeneous trade liberalization across industries. Moreover, trade intensifies localization for each industry since most firms in an industry move to or gather around their industry-specific cost- minimizing location. The consequent clustering of firms generates additional localization economies. More importantly, the intensification of localization economies can slow or delay the selection process, i.e. exit of low productivity firms, following trade liberalization. These findings suggest that trade openness induces significant industrial and spatial dynamics (entry, exit and survival) within an economy. The second and third essays are empirical tests on the second channel through which trade openness affects regional productivity using county-level data from Korea and firm-level data from India, respectively. In addition to trade liberalization, regional infrastructure is considered to be another competition pressure for domestic firms, i.e. improved infrastructure in a region induces a similar selection process among firms. These empirical essays investigate the effect of falling trade costs and improving domestic infrastructure on the regional variation of raw productivity using a common methodology. That is, a spatial econometric procedure is applied to a production function framework to estimate total factor productivity (TFP) by region and industry, while controlling for potential external and spatial effects. The mean and alternative percentiles of the regional raw productivity distribution are then specified as functions of international and domestic competition indicators. International competition is represented by trade costs, which are estimated as frictions in a gravity-type trade model, while road density is considered to capture the level of a region's infrastructure. In both Korea and India, it is found that trade costs reduction significantly shifted to the right, particularly the 10th percentile value of, the regional productivity distribution. However, a change in the level of infrastructure appears to bring about a higher change in regional productivity relative to a change in the international competition level. Therefore, the relative contribution of trade costs and infrastructure to regional productivity should be evaluated with attention to the costs underlying these options for regional development.
Three Essays in International Trade
Author: Thomas ChaneyPublisher:
ISBN:
Category :
Languages : en
Pages : 112
Book Description
(Cont.) This model provides some argument for competitive revaluations. In chapter 3, I build a dynamic model of trade with heterogeneous firms which extends the work of Melitz (2003). As countries open up to trade, they will experience a productivity overshooting. Aggregate productivity increases in the long run, but it increases even more so in the short run. When trade opens up, there are too many firms, inherited from the autarky era. The most productive foreign firms enter the domestic market. Competition is fierce. The least productive firms that are no more profitable are forced to stop production. Not only do the most productive firms increase their size because they export, but the least productive firms stop producing altogether. Aggregate productivity soars. As time goes by, firms start to exit because of age. Competition softens. Some less productive firms resume production. This pulls down aggregate productivity. The slower the exit of firms, the larger this overshooting phenomenon. This model also predicts that the price compression that accompanies trade opening may be dampened in the long run. It also predicts that inequalities should increase at the time when a country opens up to trade, and then gradually recede in the long run.
Three Essays in International Trade and Industrial Organization
Author: Ayșe Ozgür PehlivanThree Essays on Firm Productivity in Industrial Organization and International Trade
Author: Hongsong ZhangThree Essays on International Trade
Author: Seungrae Rae LeePublisher:
ISBN:
Category :
Languages : en
Pages : 234
Book Description
This dissertation consists of three essays in international trade. The first chapter analyzes integration strategies of Korean firms that involve producing final products and providing post-production services for serving geographically separate foreign markets: high-income and low-income countries. I present a model in which heterogeneous firms must provide services for products through their subsidiaries in host countries, but can produce output in different locations. The model shows that the firm's equilibrium decision depends on its own productivity level and economic variables that affect production location and providing services. Using plant- and firm-level data of Korean firms, the empirical analysis provides the results that support the model's predictions.
Three Essays on International Trade
Author: Su Wang (Ph. D.)Publisher:
ISBN:
Category :
Languages : en
Pages : 152
Book Description
This thesis consists of three essays about international trade and wage inequality. Essay I characterizes optimal trade and FDI policies in a model with monopolistic competition and firm-level heterogeneity similar to Helpman et al. (2004). I find that both the optimal import tariffs and the optimal FDI subsidies discriminate against the more profitable foreign firms. This is because of the existence of a wedge between the private incentives of exporting and FDI firms, and the incentive of the representative agent. Essay II develops an elementary theory of global supply chains. It considers a world economy with an arbitrary number of countries, one factor of production, a continuum of intermediate goods, and one final good. Production of the final good is sequential and subject to mistakes. In the unique free trade equilibrium, countries with lower probabilities of making mistakes at all stages specialize in later stages of production. Using this simple theoretical framework, it offers a first look at how vertical specialization shapes the interdependence of nations. Essay III proposes a model that has as ingredients heterogeneity of workers and firms, complementarity between occupations within each firm and complementarity between workers and firms/occupations. The competitive equilibrium features positive assortative matching and leads to both within- and between- firm wage variations. Comparative static results are then derived to generate new insights about changes in these components of wage inequality.
Author: Inderjit Kohli
Author: Eric O'Neill Fisher