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The Theoretical Equivalent of Empirically Measurable Exporter Productivity when Firms are Heterogeneous

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  • Philipp J.H. Schröder

    (ASB, Aarhus University, Denmark)

  • Allan Sørensen

    ()
    (School of Economics and Management, Aarhus University, Denmark)

Abstract

The marginal costs based representation of firm productivity in the Melitz [Melitz, M.J., 2003. The impact of trade on intra-industry reallocations and aggregate industry productiv- ity. Econometrica 71 (6), 1695-1725] model, predicts positive exporter productivity premia. We show that this prediction is reversible when computing the theoretical equivalent of the empirically measurable productivity expression (value added per worker) in the model. The paper discusses implications of this finding for empirical research.

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Bibliographic Info

Paper provided by School of Economics and Management, University of Aarhus in its series Economics Working Papers with number 2010-06.

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Length: 9
Date of creation: 05 2010
Date of revision:
Handle: RePEc:aah:aarhec:2010-06

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Web page: http://www.econ.au.dk/afn/

Related research

Keywords: Intra-industry trade; firm productivity; heterogeneous firms;

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References

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  1. Martina Lawless & Karl Whelan, 2014. "Where Do Firms Export, How Much and Why?," The World Economy, Wiley Blackwell, vol. 37(8), pages 1027-1050, 08.
  2. Jonathan Eaton & Samuel Kortum & Francis Kramarz, 2008. "An Anatomy of International Trade: Evidence from French Firms," NBER Working Papers 14610, National Bureau of Economic Research, Inc.
  3. Melitz, Marc J, 2002. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," CEPR Discussion Papers 3381, C.E.P.R. Discussion Papers.
  4. David Greenaway & Joakim Gullstrand & Richard Kneller, 2005. "Exporting May Not Always Boost Firm Productivity," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 141(4), pages 561-582, December.
  5. Hansson, Pär & Lundin, Nan Nan, 2003. "Exports as an Indicator on or Promoter of Successful Swedish Manufacturing Firms in the 1990s," Working Paper Series 189, Trade Union Institute for Economic Research.
  6. David Greenaway & Richard Kneller, 2007. "Firm heterogeneity, exporting and foreign direct investment," Economic Journal, Royal Economic Society, vol. 117(517), pages F134-F161, 02.
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