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Productivity growth in Latin American manufacturing: what role for international trade intensities?

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  • Faúndez, Sebastián

Abstract

This paper analyzes the relationship between the intensity of international trade flows and labor productivity for 28 industries in the five main economies in the region (Argentina, Brazil, Chile, Colombia and Mexico) using the Arellano-Bond generalized method of moments (GMM) estimator. The results show that international trade flows contributed through various channels to labor productivity growth in the period 1990 to 2008. These channels, which have been developed in the theoretical literature, are export intensity (share of production exported), import penetration (share of domestic demand covered by imports), the diversification of the export basket and intra-industry trade. The estimation also includes several control variables, of which several turn out significant. In addition to estimates for the total manufacturing sector, we also show results for three different groups of manufacturing industries characterized by different factor endowments: natural resource intensive, labor and capital intensive ones.

Suggested Citation

  • Faúndez, Sebastián, 2011. "Productivity growth in Latin American manufacturing: what role for international trade intensities?," Comercio Internacional 4340, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
  • Handle: RePEc:ecr:col025:4340
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    File URL: http://repositorio.cepal.org/handle/11362/4340
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    Cited by:

    1. Ahmed, Gulzar & Arshad Khan, Muhammad & Afzal, Muhammad, 2015. "Trade Liberalization and Industrial Productivity: Evidence from Pakistan," MPRA Paper 70744, University Library of Munich, Germany, revised 15 Mar 2016.

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