IDEAS home Printed from https://ideas.repec.org/p/eec/wpaper/2203.html
   My bibliography  Save this paper

The dynamic linkages between exporting and importing in Colombian manufacturing

Author

Listed:
  • Juan A. Sanchis Llopis

    (Universitat de València)

  • Silviano Juan A. Mañez Castillejo

    (Universitat de València)

  • Andrés Mauricio Gómez-Sánchez

    (Universidad del Cauca)

Abstract

This paper analyses the dynamic linkages between firms’ imports of intermediate inputs and exports, for Colombia, an emerging economy. We use data for manufacturing firms from the Colombian Annual Manufacturing Survey, for the period 2007-2016. We specially focus on the identification of direct and indirect effects of past importing/exporting experience on the likelihood of exporting and importing intermediates. We understand by indirect effects those that accrue from past experience (in exporting and importing intermediates) on the probability of exporting/importing intermediates, through enhanced productivity. Further, we analyse both own-direct effects of exporting (importing) and cross-direct effects of exporting (importing) on importing (exporting). Finally, we identify and quantify the role of sunk costs and learning in explaining exporting and importing persistence. The estimation results suggest the relevance of both direct and indirect effects (own and cross) to explain firms’ exports and imports of intermediates decisions.

Suggested Citation

  • Juan A. Sanchis Llopis & Silviano Juan A. Mañez Castillejo & Andrés Mauricio Gómez-Sánchez, 2022. "The dynamic linkages between exporting and importing in Colombian manufacturing," Working Papers 2203, Department of Applied Economics II, Universidad de Valencia.
    • Handle: RePEc:eec:wpaper:2203
    as

    Download full text from publisher

    File URL: http://repecsrv.uv.es/paper/RePEc/pdf/eec_2203.pdf
    File Function: First version, 2203
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Van Biesebroeck, Johannes, 2008. "The Sensitivity of Productivity Estimates," Journal of Business & Economic Statistics, American Statistical Association, vol. 26, pages 311-328.
    2. Feng, Ling & Li, Zhiyuan & Swenson, Deborah L., 2016. "The connection between imported intermediate inputs and exports: Evidence from Chinese firms," Journal of International Economics, Elsevier, vol. 101(C), pages 86-101.
    3. Bernard, Andrew B. & Bradford Jensen, J., 1999. "Exceptional exporter performance: cause, effect, or both?," Journal of International Economics, Elsevier, vol. 47(1), pages 1-25, February.
    4. Jan De Loecker & Frederic Warzynski, 2012. "Markups and Firm-Level Export Status," American Economic Review, American Economic Association, vol. 102(6), pages 2437-2471, October.
    5. Davide Castellani & Francesco Serti & Chiara Tomasi, 2010. "Firms in International Trade: Importers’ and Exporters’ Heterogeneity in Italian Manufacturing Industry," The World Economy, Wiley Blackwell, vol. 33(3), pages 424-457, March.
    6. Love, James H. & Máñez, Juan A., 2019. "Persistence in exporting: Cumulative and punctuated learning effects," International Business Review, Elsevier, vol. 28(1), pages 74-89.
    7. Jan De Loecker, 2013. "Detecting Learning by Exporting," American Economic Journal: Microeconomics, American Economic Association, vol. 5(3), pages 1-21, August.
    8. Campa, Jose Manuel, 2004. "Exchange rates and trade: How important is hysteresis in trade?," European Economic Review, Elsevier, vol. 48(3), pages 527-548, June.
    9. Blundell, Richard & Griffith, Rachel & Windmeijer, Frank, 2002. "Individual effects and dynamics in count data models," Journal of Econometrics, Elsevier, vol. 108(1), pages 113-131, May.
    10. Pedro Martins & Yong Yang, 2009. "The impact of exporting on firm productivity: a meta-analysis of the learning-by-exporting hypothesis," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 145(3), pages 431-445, October.
    11. Maria Bas & Vanessa Strauss-Kahn, 2013. "Input-Trade Liberalization, Export Prices and Quality Upgrading," Sciences Po publications 2013-13, Sciences Po.
    12. Paula Bustos, 2011. "Trade Liberalization, Exports, and Technology Upgrading: Evidence on the Impact of MERCOSUR on Argentinian Firms," American Economic Review, American Economic Association, vol. 101(1), pages 304-340, February.
    13. Costas Arkolakis & Theodore Papageorgiou & Olga Timoshenko, 2018. "Firm Learning and Growth," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 27, pages 146-168, January.
    14. Mary Amiti & Jozef Konings, 2007. "Trade Liberalization, Intermediate Inputs, and Productivity: Evidence from Indonesia," American Economic Review, American Economic Association, vol. 97(5), pages 1611-1638, December.
    15. Tarlok Singh, 2010. "Does International Trade Cause Economic Growth? A Survey," The World Economy, Wiley Blackwell, vol. 33(11), pages 1517-1564, November.
    16. Kasahara, Hiroyuki & Lapham, Beverly, 2013. "Productivity and the decision to import and export: Theory and evidence," Journal of International Economics, Elsevier, vol. 89(2), pages 297-316.
    17. Ana M. Fernandes & Caroline Paunov, 2013. "Does trade stimulate product quality upgrading?," Canadian Journal of Economics, Canadian Economics Association, vol. 46(4), pages 1232-1264, November.
    18. Pinelopi Koujianou Goldberg & Amit Kumar Khandelwal & Nina Pavcnik & Petia Topalova, 2010. "Imported Intermediate Inputs and Domestic Product Growth: Evidence from India," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 125(4), pages 1727-1767.
    19. Robert J.R. Elliott & Nicholas J. Horsewood & Liyun Zhang, 2019. "Importing exporters and exporting importers: A study of the decision of Chinese firms to engage in international trade," Review of International Economics, Wiley Blackwell, vol. 27(1), pages 240-266, February.
    20. Chamberlain, Gary, 1982. "Multivariate regression models for panel data," Journal of Econometrics, Elsevier, vol. 18(1), pages 5-46, January.
    21. Murat Şeker, 2012. "Importing, Exporting, and Innovation in Developing Countries," Review of International Economics, Wiley Blackwell, vol. 20(2), pages 299-314, May.
    22. Kasahara, Hiroyuki & Rodrigue, Joel, 2008. "Does the use of imported intermediates increase productivity? Plant-level evidence," Journal of Development Economics, Elsevier, vol. 87(1), pages 106-118, August.
    23. Olley, G Steven & Pakes, Ariel, 1996. "The Dynamics of Productivity in the Telecommunications Equipment Industry," Econometrica, Econometric Society, vol. 64(6), pages 1263-1297, November.
    24. Juan A. Máñez Castillejo & Consuelo Mínguez Bosque & María E. Rochina Barrachina & Juan A. Sanchis Llopis, 2020. "Trading activities, productivity and markups: Evidence for Spanish manufacturing," The World Economy, Wiley Blackwell, vol. 43(3), pages 644-680, March.
    25. László Halpern & Miklós Koren & Adam Szeidl, 2015. "Imported Inputs and Productivity," American Economic Review, American Economic Association, vol. 105(12), pages 3660-3703, December.
    26. Andrew B. Bernard & J. Bradford Jensen, 2004. "Why Some Firms Export," The Review of Economics and Statistics, MIT Press, vol. 86(2), pages 561-569, May.
    27. Jože P. Damijan & Črt Kostevc, 2015. "Learning from Trade through Innovation," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 77(3), pages 408-436, June.
    28. Marc-Andreas Muendler, 2004. "Trade, Technology, and Productivity: A Study of Brazilian Manufacturers, 1986-1998," CESifo Working Paper Series 1148, CESifo.
    29. Timoshenko, Olga A., 2015. "Product switching in a model of learning," Journal of International Economics, Elsevier, vol. 95(2), pages 233-249.
    30. De Loecker, Jan, 2007. "Do exports generate higher productivity? Evidence from Slovenia," Journal of International Economics, Elsevier, vol. 73(1), pages 69-98, September.
    31. Juan A. Máñez & María E. Rochina-Barrachina & Juan A. Sanchis, 2008. "Sunk Costs Hysteresis in Spanish Manufacturing Exports," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 144(2), pages 272-294, July.
    32. Bas, Maria & Strauss-Kahn, Vanessa, 2015. "Input-trade liberalization, export prices and quality upgrading," Journal of International Economics, Elsevier, vol. 95(2), pages 250-262.
    33. Roberts, Mark J & Tybout, James R, 1997. "The Decision to Export in Colombia: An Empirical Model of Entry with Sunk Costs," American Economic Review, American Economic Association, vol. 87(4), pages 545-564, September.
    34. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(2), pages 317-341.
    35. Wooldridge, Jeffrey M., 2009. "On estimating firm-level production functions using proxy variables to control for unobservables," Economics Letters, Elsevier, vol. 104(3), pages 112-114, September.
    36. Timoshenko, Olga A., 2015. "Learning versus sunk costs explanations of export persistence," European Economic Review, Elsevier, vol. 79(C), pages 113-128.
    37. Richard Blundell & Rachel Griffith & John van Reenen, 1999. "Market Share, Market Value and Innovation in a Panel of British Manufacturing Firms," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 66(3), pages 529-554.
    38. Ana Cecília Fieler & Marcela Eslava & Daniel Yi Xu, 2018. "Trade, Quality Upgrading, and Input Linkages: Theory and Evidence from Colombia," American Economic Review, American Economic Association, vol. 108(1), pages 109-146, January.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Juan A. Máñez Castillejo & Consuelo Mínguez Bosque & María E. Rochina Barrachina & Juan A. Sanchis Llopis, 2020. "Trading activities, productivity and markups: Evidence for Spanish manufacturing," The World Economy, Wiley Blackwell, vol. 43(3), pages 644-680, March.
    2. Juan A. Máñez & María E. Rochina‐Barrachina & Juan A. Sanchis, 2020. "Foreign sourcing and exporting," The World Economy, Wiley Blackwell, vol. 43(5), pages 1151-1187, May.
    3. Xavier Cirera & Daniel Lederman & Juan A. Máñez Castillejo & María E. Rochina Barrachina & Juan A. Sanchis-Llopis, 2021. "Firm productivity gains in a period of slow trade liberalization: evidence from Brazil," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 38(1), pages 57-87, April.
    4. Andrés Mauricio Gómez‐Sánchez & Juan A. Mañez & Juan A. Sanchis‐Llopis, 2022. "Are importing and exporting complements or substitutes in an emerging economy? The case of Colombia," Review of International Economics, Wiley Blackwell, vol. 30(3), pages 819-835, August.
    5. Torres Mazzi, Caio & Foster-McGregor, Neil, 2021. "Imported intermediates, technological capabilities and exports: Evidence from Brazilian firm-level data," Research Policy, Elsevier, vol. 50(1).
    6. Pian Shu & Claudia Steinwender, 2019. "The Impact of Trade Liberalization on Firm Productivity and Innovation," Innovation Policy and the Economy, University of Chicago Press, vol. 19(1), pages 39-68.
    7. María D. Parra & Inmaculada Martínez-Zarzoso, 2014. "Imported intermediate inputs and Egyptian exports: Exploring the links," Working Papers 2014/09, Economics Department, Universitat Jaume I, Castellón (Spain).
    8. Mauro Caselli, 2018. "Do all imports matter for productivity? Intermediate inputs vs capital goods," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 35(2), pages 285-311, August.
    9. Maria Bas & Vanessa Strauss-Kahn, 2014. "Does importing more inputs raise exports? Firm-level evidence from France," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 150(2), pages 241-275, May.
    10. Robert J. R. Elliott & Liza Jabbour & Liyun Zhang, 2016. "Firm productivity and importing: Evidence from Chinese manufacturing firms," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 49(3), pages 1086-1124, August.
    11. Marco Grazzi & Nanditha Mathew & Daniele Moschella, 2021. "Making one’s own way: jumping ahead in the capability space and exporting among Indian firms," Journal of Evolutionary Economics, Springer, vol. 31(3), pages 931-957, July.
    12. Newman, Carol & Rand, John & Tarp, Finn, 2023. "Imports, supply chains and firm productivity," World Development, Elsevier, vol. 172(C).
    13. Giordano, Claire & Lopez-Garcia, Paloma, 2019. "Firm heterogeneity and trade in EU countries: a cross-country analysis," Occasional Paper Series 225, European Central Bank.
    14. Lawrence Edwards & Marco Sanfilippo & Asha Sundaram, 2016. "Importing and firm performance: New evidence from South Africa," WIDER Working Paper Series 039, World Institute for Development Economic Research (UNU-WIDER).
    15. Imbruno, Michele & Ketterer, Tobias D., 2018. "Energy efficiency gains from importing intermediate inputs: Firm-level evidence from Indonesia," Journal of Development Economics, Elsevier, vol. 135(C), pages 117-141.
    16. Lawrence Edwards & Marco Sanfilippo & Asha Sundaram, 2020. "Importing and Productivity: An Analysis of South African Manufacturing Firms," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 57(2), pages 411-432, September.
    17. Deasy D. Pane & Arianto A. Patunru, 2023. "The role of imported inputs in firms’ productivity and exports: evidence from Indonesia," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 159(3), pages 629-672, August.
    18. Massini, Silvia & Piscitello, Lucia & Shevtsova, Yevgeniya, 2023. "The complementarity effect of exporting, importing and R&D on the productivity of Ukrainian MNEs," International Business Review, Elsevier, vol. 32(3).
    19. Liu, Qing & Qiu, Larry D., 2016. "Intermediate input imports and innovations: Evidence from Chinese firms' patent filings," Journal of International Economics, Elsevier, vol. 103(C), pages 166-183.
    20. Lawrence Edwards & Marco Sanfilippo & Asha Sundaram, 2016. "Importing and firm performance: New evidence from South Africa," WIDER Working Paper Series wp-2016-39, World Institute for Development Economic Research (UNU-WIDER).

    More about this item

    Keywords

    Exports; Imports of intermediates; bivariate probit; TFP; emerging country;
    All these keywords.

    JEL classification:

    • C35 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Discrete Regression and Qualitative Choice Models; Discrete Regressors; Proportions
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eec:wpaper:2203. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Vicente Esteve (email available below). General contact details of provider: https://edirc.repec.org/data/dsvales.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.