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International Competition and Industrial Performance: Allocative Efficiency, Productive Efficiency, and Turbulence

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Author Info
Baldwin, John R.
Caves, Richard

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Abstract

Trade exerts generally favourable effects on the performance of domestic manufacturing industries in the dimensions of allocative and productive efficiency. This paper reviews theory and recent evidence on these linkages and also explore a third effect-on the turbulence of competitive conditions and the turnover of business units. Calculations using primary census records for Canada over 1973-1992 indicate, with time and industry effect, controlled, market-share turnover, entry, exit, and mergers all increase with trade exposure. The effect is tied to market structures of differentiated products but broad international disturbances (North American Free Trade Area) also have significant effects. The normative significant of turbulence is mixed but has important positive components.

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File URL: http://www.statcan.gc.ca/bsolc/olc-cel/olc-cel?catno=11F0019M1997108&lang=eng
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Publisher Info
Paper provided by Statistics Canada, Analytical Studies Branch in its series Analytical Studies Branch Research Paper Series with number 1997108e.

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Date of creation: 15 Oct 1997
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Handle: RePEc:stc:stcp3e:1997108e

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Related research
Keywords: Business performance and ownership; International trade; Business adaptation and adjustment; Entry; exit; mergers and growth; Trade patterns; Current conditions;

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Ian Domowitz & R. Glenn Hubbard & Bruce C. Petersen, 1986. "Business Cycles and the Relationship Between Concentration and Price-Cost Margins," RAND Journal of Economics, The RAND Corporation, vol. 17(1), pages 1-17, Spring. [Downloadable!] (restricted)
  2. Yamawaki, Hideki, 1986. "Exports, Foreign Market Structure, and Profitability in Japanese and U.S. Manufacturing," The Review of Economics and Statistics, MIT Press, vol. 68(4), pages 618-27, November. [Downloadable!] (restricted)
  3. Katics, Michelle M & Petersen, Bruce C, 1994. "The Effect of Rising Import Competition on Market Power: A Panel Data Study of U.S. Manufacturing," Journal of Industrial Economics, Blackwell Publishing, vol. 42(3), pages 277-86, September. [Downloadable!] (restricted)
  4. Robert H. McGuckin & Sang V. Nguyen, 1995. "On Productivity and Plant Ownership Change: New Evidence from the Longitudinal Research Database," RAND Journal of Economics, The RAND Corporation, vol. 26(2), pages 257-276, Summer. [Downloadable!] (restricted)
  5. Romer, Paul, 1994. "New goods, old theory, and the welfare costs of trade restrictions," Journal of Development Economics, Elsevier, vol. 43(1), pages 5-38, February. [Downloadable!] (restricted)
    Other versions:
  6. Pugel, Thomas A, 1980. "Foreign Trade and US Market Performance," Journal of Industrial Economics, Blackwell Publishing, vol. 29(2), pages 119-29, December. [Downloadable!] (restricted)
  7. Michael Spence, 1978. "Tacit Co-ordination and Imperfect Information," Canadian Journal of Economics, Canadian Economics Association, vol. 11(3), pages 490-505, August. [Downloadable!] (restricted)
  8. Baldwin, John R., 1996. "Productivity Growth, Plant Turnover and Restructuring in the Canadian Manufacturing Sector," Analytical Studies Branch Research Paper Series 1995087e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
  9. Yamawaki, Hideki, 1991. "Exports and Foreign Distributional Activities: Evidence on Japanese Firms in the United States," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 294-300, May. [Downloadable!] (restricted)
  10. Yamawaki, Hideki & Audretsch, David B, 1988. "Import Share under International Oligopoly with Differentiated Products: Japanese Imports in U.S. Manufacturing," The Review of Economics and Statistics, MIT Press, vol. 70(4), pages 569-79, November. [Downloadable!] (restricted)
  11. Nickell, Stephen J, 1996. "Competition and Corporate Performance," Journal of Political Economy, University of Chicago Press, vol. 104(4), pages 724-46, August. [Downloadable!] (restricted)
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  12. MacDonald, James M, 1994. "Does Import Competition Force Efficient Production?," The Review of Economics and Statistics, MIT Press, vol. 76(4), pages 721-27, November. [Downloadable!] (restricted)
  13. Caves, Richard E & Porter, Michael E, 1978. "Market Structure, Oligopoly, and Stability of Market Shares," Journal of Industrial Economics, Blackwell Publishing, vol. 26(4), pages 289-313, June. [Downloadable!] (restricted)
  14. Caves, Richard E., 1985. "International trade and industrial organization: Problems, solved and unsolved," European Economic Review, Elsevier, vol. 28(3), pages 377-395, August. [Downloadable!] (restricted)
  15. Steven J. Davis & John C. Haltiwanger & Scott Schuh, 1998. "Job Creation and Destruction," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262540932, December.
  16. repec:cup:cbooks:9780521465618 is not listed on IDEAS
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Xiaolan Fu, 2005. "Exports, technical progress and productivity growth in a transition economy: a non-parametric approach for China," Applied Economics, Taylor and Francis Journals, vol. 37(7), pages 725-739, April. [Downloadable!] (restricted)
  2. Xiaolan Fu, 2004. "Exports, Technical Progress and Productivity Growth in Chinese Manufacturing Industries," ESRC Centre for Business Research - Working Papers wp278, ESRC Centre for Business Research. [Downloadable!]
  3. Robin Leichenko & Julie Silva, 2003. "International Trade, Employment, and Earnings: Evidence from U.S. Rural Counties," Working Papers 03-12, Center for Economic Studies, U.S. Census Bureau. [Downloadable!]
    Other versions:
  4. David Laidler, 1999. "Canada's Exchange Rate Options," Canadian Public Policy, University of Toronto Press, vol. 25(3), pages 324-332, September. [Downloadable!] (restricted)
  5. VN Balasubramanyam & Xiaolan Fu, 2002. "Township and village enterprises in China," Working Papers 000047, Lancaster University Management School, Economics Department. [Downloadable!]
    Other versions:
  6. Gu, Wulong & Sawchuk, Gary, 2006. "How Are Canadian Regions Adjusting to a Larger and More Integrated North American Market?," Economic Analysis (EA) Research Paper Series 2006039e, Statistics Canada, Analytical Studies Branch. [Downloadable!]
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