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Robots and export quality

Author

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  • DeStefano, Timothy
  • Timmis, Jonathan

Abstract

Robots are becoming a key part of manufacturing in developed and emerging economies. This paper examines how automation can affect international trade through quality upgrading. The effects of robot use on export quality are estimated, by combining cross-country and cross-industry data on industrial robots with detailed Harmonized System 10-digit trade data. Robot diffusion in (preexisting) foreign customers is used as an instrumental variable to predict robot adoption in the home country-industry. The findings show that robot diffusion increases the quality of exported products. Quality improvements are predominantly driven by upgrading of (initially) lower-quality exports of developed and developing countries. Since developing countries tend to export lower quality goods, we find stronger effects overall for developing economies. The paper also finds some differences in the type of robots – sophisticated or more basic – are associated with quality gains in developing and developed economies.

Suggested Citation

  • DeStefano, Timothy & Timmis, Jonathan, 2024. "Robots and export quality," Journal of Development Economics, Elsevier, vol. 168(C).
    • Handle: RePEc:eee:deveco:v:168:y:2024:i:c:s0304387823002043
    DOI: 10.1016/j.jdeveco.2023.103248
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    More about this item

    Keywords

    Robots; Automation; Quality; Upgrading; Trade; Global value chains; Development;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • O1 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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