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Imperfect Competition, Returns To Scale and Productivity Growth In Australian Manufacturing: A Smooth Transition Approach To Trade Liberalisation

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  • Edward Oczkowski
  • Kishor Sharma

Abstract

This Paper examines the relationship between trade liberalization and productivity growth for Australian manufacturing. An imperfect competition, non-CRS, smooth transition empirical framework is employed for analysis. GMM estimates of the logistic smooth transition model imply that trade reform impacts take approximately four years to complete, but do not occur over the same time period for all industries. In response to trade reforms, for most industries a significant improvement in productivity is estimated, these improvements are associated with lower mark-ups and falling scale parameters. A minority of industries however, experienced no change or falling productivity growth in response to reforms, these industries tended to have the highest absolute protection levels. [D24, F12, C52, L60]

Suggested Citation

  • Edward Oczkowski & Kishor Sharma, 2001. "Imperfect Competition, Returns To Scale and Productivity Growth In Australian Manufacturing: A Smooth Transition Approach To Trade Liberalisation," International Economic Journal, Taylor & Francis Journals, vol. 15(2), pages 99-113, June.
    • Handle: RePEc:taf:intecj:v:15:y:2001:i:2:p:99-113
    DOI: 10.1080/10168730100000039
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    Cited by:

    1. Renuka Mahadevan, 2002. "Trade liberalization and productivity growth in Australian manufacturing industries," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 30(2), pages 170-185, June.
    2. Jayanthakumaran, Kankesu & Neri, Frank, 2004. "Trade Reforms and Changes in Australian Manufactured Exports," Economics Working Papers wp04-09, School of Economics, University of Wollongong, NSW, Australia.
    3. Geng, Nan, 2011. "The dynamics of market structure and firm-level adjustment to India's pro-market economic liberalizing reforms, 1988-2006: A Time Varying Panel Smooth Transition Regression (TV-PSTR) approach," International Review of Economics & Finance, Elsevier, vol. 20(4), pages 506-519, October.
    4. Jayanthakumaran, K., 1999. "Trade Reforms and Manufacturing Performance: Australia 1989-97," Economics Working Papers WP99-13, School of Economics, University of Wollongong, NSW, Australia.
    5. Bopage Lionel & Sharma Kishor, 2014. "Trade Liberalization and Productivity Performance: Evidence from the Australian Passenger Motor Vehicle Industry," Global Economy Journal, De Gruyter, vol. 14(3-4), pages 467-485, October.
    6. Dean Parham, 2004. "Sources of Australia's Productivity Revival," The Economic Record, The Economic Society of Australia, vol. 80(249), pages 239-257, June.
    7. Alfons Palangkaraya & Jongsay Yong, 2011. "Trade Liberalisation, Exit, and Output and Employment Adjustments of Australian Manufacturing Establishments," The World Economy, Wiley Blackwell, vol. 34(1), pages 1-22, January.
    8. Patricia Augier & Michael Gasiorek & Gonzalo Varela, 2007. "Determinants of Productivity in Morocco - The Role of Trade?," CARIS Working Papers 02, Centre for the Analysis of Regional Integration at Sussex, University of Sussex.
    9. Harry Bloch, 2010. "Technological Change in Australian Manufacturing," Australian Economic Review, The University of Melbourne, Melbourne Institute of Applied Economic and Social Research, vol. 43(1), pages 28-38, March.
    10. Valadkhani, Abbas, 2005. "Which Industries Create More Employment? A Cross-Country Analysis," Economics Working Papers wp05-07, School of Economics, University of Wollongong, NSW, Australia.

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