Ricardian trade and the impact of domestic competition on export performance
AbstractThis paper develops and empirically examines a model of relative productivity differences both within and across industries for small open economies. We decompose the effect of industry productivity on export performance into direct effect of own-firm productivity and an indirect effect of higher peer-firm productivity. In a sample of Chilean and Colombian plants, we find evidence of both a positive direct effect and a negative indirect effect. The empirical evidence supports our theoretical prediction that industry-specific factors of production and asymmetric substitutability between domestic and foreign varieties drive the negative indirect effect. JEL classification: F10, F11, F12
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Bibliographic InfoArticle provided by Canadian Economics Association in its journal Canadian Journal of Economics.
Volume (Year): 45 (2012)
Issue (Month): 2 (May)
Contact details of provider:
Postal: Canadian Economics Association Prof. Steven Ambler, Secretary-Treasurer c/o Olivier Lebert, CEA/CJE/CPP Office C.P. 35006, 1221 Fleury Est Montréal, Québec, Canada H2C 3K4
Web page: http://economics.ca/cje/
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Find related papers by JEL classification:
- F10 - International Economics - - Trade - - - General
- F11 - International Economics - - Trade - - - Neoclassical Models of Trade
- F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
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- William R. Kerr, 2013.
"Heterogeneous Technology Diffusion and Ricardian Trade Patterns,"
Harvard Business School Working Papers
14-039, Harvard Business School.
- William R. Kerr, 2013. "Heterogeneous Technology Diffusion and Ricardian Trade Patterns," NBER Working Papers 19657, National Bureau of Economic Research, Inc.
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