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Which Companies Benefit from Liberalization? a Study of the Influence of Initial Productivity

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  • Delia Baghdasaryan
  • Lisbeth Cour
  • Cédric Schneider

Abstract

Theoretical research shows that competition has positive effects on productivity, for companies that are initially efficient, but not for unproductive firms. Our empirical analysis on a panel data of Czech companies, years 1995–2004, confirms this result. In addition, our analysis shows that when economic reforms affect both domestic and foreign competition, controlling for domestic competition is crucial when assessing the impact of trade liberalization. Otherwise, the effect of trade liberalization on firm productivity is upward biased. Copyright Springer Science+Business Media New York 2016

Suggested Citation

  • Delia Baghdasaryan & Lisbeth Cour & Cédric Schneider, 2016. "Which Companies Benefit from Liberalization? a Study of the Influence of Initial Productivity," Journal of Industry, Competition and Trade, Springer, vol. 16(1), pages 101-125, March.
  • Handle: RePEc:kap:jincot:v:16:y:2016:i:1:p:101-125
    DOI: 10.1007/s10842-015-0203-y
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    Keywords

    Firm productivity; Trade liberalization; Competition; Initial productivity; D24; F10;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • F10 - International Economics - - Trade - - - General

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