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Import Penetration, Intermediate Inputs and Productivity: Evidence from Italian Firms

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Author Info
Altomonte, Carlo
Barattieri, Alessandro
Rungi, Armando

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Abstract

We test the impact of import penetration on the productivity of a sample of roughly 35,000 Italian manufacturing firms operating in the period 1996-2003, considering the impact on productivity of both import penetration in the same industry and import penetration in the up-stream industries. We find that import penetration has a positive effect on productivity, but the effects are three times as large for import penetration in up-stream industries. Trade-related variables do not account however for the bulk of variation in individual firms' TFP.

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Paper provided by Economic and Social Research Institute (ESRI) in its series Papers with number DYNREG23.

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Date of creation: 2008
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Handle: RePEc:esr:wpaper:dynreg23

Note: DYNREG Research Project - Dynamic Regions in a Knowledge-Driven Global Economy: Lessons and Policy Implications for the European Union
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Keywords: DYNREG; import penetration; intermediate inputs; productivity;

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  6. Marc J. Melitz & Gianmarco I.P. Ottaviano, 2005. "Market Size, Trade, and Productivity," NBER Working Papers 11393, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  7. Feenstra, Robert C & Markusen, James R & Zeile, William, 1992. "Accounting for Growth with New Inputs: Theory and Evidence," American Economic Review, American Economic Association, vol. 82(2), pages 415-21, May. [Downloadable!] (restricted)
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  9. Baybars Karacaovali, 2008. "Productivity Matters for Trade Policy: Theory and Evidence," Fordham Economics Discussion Paper Series dp2008-14, Fordham University, Department of Economics. [Downloadable!]
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  10. Francisco Alcalá & Antonio Ciccone, 2004. "Trade and Productivity," The Quarterly Journal of Economics, MIT Press, vol. 119(2), pages 612-645, May. [Downloadable!] (restricted)
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  11. David Hummels & Peter J. Klenow, 2002. "The Variety and Quality of a Nation's Trade," NBER Working Papers 8712, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  15. Beata Smarzynska Javorcik, 2004. "Does Foreign Direct Investment Increase the Productivity of Domestic Firms? In Search of Spillovers Through Backward Linkages," American Economic Review, American Economic Association, vol. 94(3), pages 605-627, June. [Downloadable!]
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