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Does importing more inputs raise exports? Firm level evidence from France

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  • Bas, Maria
  • Strauss-Kahn, Vanessa

Abstract

Following Melitz (2003)'s seminal paper, several theoretical and empirical studies have shown that only the subset of most productive firms export. While other studies provide evidence on a positive effect of an increase in imported inputs on firms' productivity, the link between imported intermediate inputs and export scope has not been made. This paper bridges the gap by studying the impact of imported inputs on the margins of exports. We use a unique firms' level database of imports at the product (HS6) level provided by French Customs for the 1995-2005 period. Access to new varieties of inputs may increase productivity, and thereby exports, through better complementarity of inputs, transfer of technology and/or decreased inputs price index. We test for these different mechanisms by distinguishing the origin of imports (developing vs. developed countries) and constructing an exact price index a la Broda and Weinstein (2006). We find a significant impact of higher diversification and increased number of imported inputs varieties on firm's TFP and export scope. Whereas the complementarity and transfer of technology mechanisms are supported by our results, the price effect seems very limited.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 27315.

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Date of creation: Dec 2010
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Handle: RePEc:pra:mprapa:27315

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Keywords: Firm heterogeneity; imported inputs; TFP; export scope; varieties; price index; firm-level data;

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References

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Citations

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Cited by:
  1. Colantone, Italo & Crinò, Rosario, 2014. "New imported inputs, new domestic products," Journal of International Economics, Elsevier, vol. 92(1), pages 147-165.
  2. Cadot, Olivier & Carrere, Celine & Strauss-Kahn, Vanessa, 2011. "OECD imports : diversification of suppliers and quality search," Policy Research Working Paper Series 5627, The World Bank.
  3. Paolo Guerrieri & Filippo Vergara Caffarelli, 2012. "Trade Openness and International Fragmentation of Production in the European Union: The New Divide?," Review of International Economics, Wiley Blackwell, vol. 20(3), pages 535-551, 08.
  4. Anna Bohnstedt, 2013. "Spillovers from Foreign Exporters," Ruhr Economic Papers 0400, Rheinisch-Westfälisches Institut für Wirtschaftsforschung, Ruhr-Universität Bochum, Universität Dortmund, Universität Duisburg-Essen.
  5. Joachim Wagner, 2012. "International trade and firm performance: a survey of empirical studies since 2006," Review of World Economics (Weltwirtschaftliches Archiv), Springer, vol. 148(2), pages 235-267, June.
  6. Alessia Lo Turco & Daniela Maggioni, 2013. "On the Role of Imports in Enhancing Manufacturing Exports," The World Economy, Wiley Blackwell, vol. 36(1), pages 93-120, 01.
  7. David Aristei & Davide Castellani & Chiara Franco, 2011. "Firms' exporting and importing activities: is there a two-way relationship?," Quaderni del Dipartimento di Economia, Finanza e Statistica 99/2011, Università di Perugia, Dipartimento Economia, Finanza e Statistica.
  8. Maria Bas, 2013. "Does Services Liberalization Affect Manufacturing Firms' Export Performance? Evidence from India," Working Papers 2013-17, CEPII research center.
  9. Neil Foster-McGregor & Anders Isaksson & Florian Kaulich, 2013. "Importing, Productivity and Absorptive Capacity in Sub-Saharan African Manufacturing Firms," wiiw Working Papers 105, The Vienna Institute for International Economic Studies, wiiw.
  10. Bas, Maria, 2012. "Input-trade liberalization and firm export decisions: Evidence from Argentina," Journal of Development Economics, Elsevier, vol. 97(2), pages 481-493.

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