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Trade Reforms in a Global Competition Model: the Case of Chile

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  • Luca David Opromolla

    (New York University - Department of Economics)

  • Alfonso Irarrazabal

    (New York University - Department of Economics)

Abstract

We use a global competition model of international trade to characterize the effects of trade reforms occurred in Chile at the end of the 70s. We calibrate the model and evaluate its results using a comprehensive plant-level dataset for the period 1979-96. The model is able to explain many of the effects of liberalization reforms on industry performance. We proceed by exploring the impact of preferential trade agreements negotiated by Chile in recent years with the European Union and the North American Free Trade Agreement.

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File URL: http://128.118.178.162/eps/it/papers/0508/0508007.pdf
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Bibliographic Info

Paper provided by EconWPA in its series International Trade with number 0508007.

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Length: 25 pages
Date of creation: 09 Aug 2005
Date of revision:
Handle: RePEc:wpa:wuwpit:0508007

Note: Type of Document - pdf; pages: 25
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Web page: http://128.118.178.162

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References

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  1. Andrew B. Bernard & Jonathan Eaton & J. Bradford Jensen & Samuel Kortum, 2000. "Plants and Productivity in International Trade," Boston University - Institute for Economic Development 105, Boston University, Institute for Economic Development.
  2. Jonathan Eaton & Samuel Kortum & Francis Kramarz, 2011. "An Anatomy of International Trade: Evidence From French Firms," Econometrica, Econometric Society, vol. 79(5), pages 1453-1498, 09.
  3. Nina Pavcnik, 2002. "Trade Liberalization, Exit, and Productivity Improvements: Evidence from Chilean Plants," Review of Economic Studies, Oxford University Press, vol. 69(1), pages 245-276.
  4. Wonnacott, Ronald J, 1996. "Free-Trade Agreements: For Better or Worse?," American Economic Review, American Economic Association, vol. 86(2), pages 62-66, May.
  5. Soloaga, Isidro & Winters, L. Alan, 1999. "Regionalism in the Nineties: What Effect on Trade?," CEPR Discussion Papers 2183, C.E.P.R. Discussion Papers.
  6. Lucia Foster & John C. Haltiwanger & C. J. Krizan, 2001. "Aggregate Productivity Growth. Lessons from Microeconomic Evidence," NBER Chapters, in: New Developments in Productivity Analysis, pages 303-372 National Bureau of Economic Research, Inc.
  7. Liu, Lili, 1993. "Entry-exit, learning, and productivity change Evidence from Chile," Journal of Development Economics, Elsevier, vol. 42(2), pages 217-242, December.
  8. Timothy Dunne & Mark J. Roberts & Larry Samuelson, 1988. "Patterns of Firm Entry and Exit in U.S. Manufacturing Industries," RAND Journal of Economics, The RAND Corporation, vol. 19(4), pages 495-515, Winter.
  9. Bernard, A., 1997. "Exceptional Exporter Performance: Cause, Effect, or Both?," Working papers 97-21, Massachusetts Institute of Technology (MIT), Department of Economics.
  10. repec:fth:michin:445 is not listed on IDEAS
  11. Andrew B. Bernard, 2004. "Exporting and Productivity in the USA," Oxford Review of Economic Policy, Oxford University Press, vol. 20(3), pages 343-357, Autumn.
  12. Andrew B. Bernard & J. Bradford Jensen, 2000. "Exporting and Productivity," Working Papers 00-07, Center for Economic Studies, U.S. Census Bureau.
  13. Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
  14. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
  15. Jonathan Eaton & Samuel Kortum & Francis Kramarz, 2004. "Dissecting trade: firms, industries, and export destinations," Staff Report 332, Federal Reserve Bank of Minneapolis.
  16. Glenn W. Harrison & Thomas F. Rutherford & David G. Tarr, 2002. "Trade Policy Options for Chile: The Importance of Market Access," World Bank Economic Review, World Bank Group, vol. 16(1), pages 49-79, June.
  17. Levinsohn, J. & Petrin, A., 1999. "When Industries Become More Productive, Do Firms?: Investigating Productivity Dynamics," Working Papers 445, Research Seminar in International Economics, University of Michigan.
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Cited by:
  1. Holger Breinlich & Alejandro Cuñat, 2010. "Trade liberalization and heterogeneous firm models: an evaluation using the Canada - US Free Trade Agreement," LSE Research Online Documents on Economics 28725, London School of Economics and Political Science, LSE Library.
  2. Raphael Bergoeing & Alejandro Micco & Andrea Repetto, 2011. "Dissecting the Chilean Export Boom," Working Papers wp339, University of Chile, Department of Economics.
  3. Luca David Opromolla & Alfonso Irarrazabal, 2005. "Hysteresis in Export Markets," International Trade 0512003, EconWPA.
  4. Bas, Maria & Ledezma, Ivan, 2007. "Market Access and the Evolution of within Plant Productivity in Chile," Economics Papers from University Paris Dauphine 123456789/6913, Paris Dauphine University.

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