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Determinants of Productivity in Morocco: the Role of Trade?

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  • Michael Gasiorek

    ()
    (Centre for the Analysis of Regional Integration at Sussex, Department of Economics, University of Sussex)

Abstract

The aim of this paper is to explore the determinants of productivity and productivity change in the Moroccan economy, with a particular interest in examining the role of international trade in impacting upon productivity levels. Methodologically this is achieved through a two-stage methodology. First we focus on productivity, and productivity change and its determinants at the micro (firm) level. The underlying data we have comprises both detailed cross section data, as well as slightly less detailed time series data. In the first stage then we derive estimates of firm and sectoral level productivity, and examine their evolution over time. For this first stage we derive the firm level productivity measures using both econometric and index number approaches. The second stage of the work is concerned with understanding and explaining the differences in productivity across the firms/sectors, and in particular of the role of trade liberalization in this. This involves regressing the differences in productivity on a range of key explanatory variables. This analysis is carried out at the firm level, and for different time periods. Our results suggest that changes in firm level productivity are relatively modest (in particular in the latter half of the period), and that there are quite considerable changes in aggregate productivity arising from a relatively high degree of entry and exit of firms, and from changes in the shares of incumbent firms. This suggests clearly that it is changing market shares, and the entry and exit from the industry that are key to understanding the aggregate productivity changes. It also suggests that is important to consider carefully the institutitional, financial and regulatory framework within which firms operate, and thus the constraints they face. Central to the methodology and the results in this report is the need to recognize the importance of firm level heterogeneity. The results indicate that the relationship between key variables such as import or export openness can vary importantly according to the size (class) of the firm. It is thus important to understand the sources of these differences in these relationships better, and secondly to tailor policy accordingly. Hence, while overall we find a positive relationship between exports and productivity we also find that the relationship between exporting and productivity is weakest for large firms.

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Bibliographic Info

Paper provided by Economic Research Forum in its series Working Papers with number 0716.

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Length: 31 pages
Date of creation: Nov 2007
Date of revision: Nov 2007
Publication status: Published by The Economic Research Forum (ERF)
Handle: RePEc:erg:wpaper:0716

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  1. Haddad, Mona, 1993. "How trade liberalization affected productivity in Morocco," Policy Research Working Paper Series 1096, The World Bank.
  2. Rodríguez, Francisco & Rodrik, Dani, 1999. "Trade Policy and Economic Growth: A Sceptic's Guide to the Cross-National Evidence," CEPR Discussion Papers 2143, C.E.P.R. Discussion Papers.
  3. G. Steven Olley & Ariel Pakes, 1992. "The Dynamics of Productivity in the Telecommunications Equipment Industry," NBER Working Papers 3977, National Bureau of Economic Research, Inc.
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  9. Angelucci, Manuella & Estrin, Saul & Konings, Jozef & Zólkiewski, Zbigniew, 2001. "The Effect of Ownership and Competitive Pressure on Firm Performance in Transition Countries: Micro Evidence from Bulgaria, Romania and Poland," CEPR Discussion Papers 2985, C.E.P.R. Discussion Papers.
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  13. Sofronis Clerides & Saul Lach & James Tybout, 1996. "Is "learning-by-exporting" important? Micro-dynamic evidence from Colombia, Mexico and Morocco," Finance and Economics Discussion Series 96-30, Board of Governors of the Federal Reserve System (U.S.).
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  21. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
  22. David T. Coe & Alexander W. Hoffmaister, 1999. "Are there International RandD Spillovers Among Randomly Matched Trade Partners? A Response to Keller," IMF Working Papers 99/18, International Monetary Fund.
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Cited by:
  1. Malgorzata Sulimierska, 2014. "Total factor productivity estimation for Polish manufacturing industry: A comparison of alternative methods," Working Paper Series 6714, Department of Economics, University of Sussex.
  2. Ayadi, Rym & De Groen, Willem Pieter, 2014. "Micro-, Small- and Medium-Sized Enterprises with High-Growth Potential in the Southern Mediterranean: Identifying Obstacles and Policy Responses," CEPS Papers 8796, Centre for European Policy Studies.

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