IDEAS home Printed from https://ideas.repec.org/a/ucp/jpolec/doi10.1086-725703.html
   My bibliography  Save this article

O-Ring Production Networks

Author

Listed:
  • Banu Demir
  • Ana Cecília Fieler
  • Daniel Yi Xu
  • Kelly Kaili Yang

Abstract

We document strong skill matching in Turkish firms’ production networks. Additionally, in the data, export demand shocks from rich countries increase firms’ skill intensity and their trade with skill-intensive domestic partners. We explain these patterns using a quantitative model with heterogeneous firms, quality choices, and endogenous networks. A counterfactual economy-wide export demand shock of 5% leads both exporters and nonexporters to upgrade quality, raising the average wage by 1.2%. This effect is nine times the effect in a scenario without interconnected quality choices. We use the model to study the conditions for the success of export promotion policies.

Suggested Citation

  • Banu Demir & Ana Cecília Fieler & Daniel Yi Xu & Kelly Kaili Yang, 2024. "O-Ring Production Networks," Journal of Political Economy, University of Chicago Press, vol. 132(1), pages 200-247.
    • Handle: RePEc:ucp:jpolec:doi:10.1086/725703
    DOI: 10.1086/725703
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/725703
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: http://dx.doi.org/10.1086/725703
    Download Restriction: Access to the online full text or PDF requires a subscription.
    File URL: https://libkey.io/10.1086/725703?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Giordano Mion & Joana Silva, 2024. "Trade, skills and productivity," CEP Discussion Papers dp2009, Centre for Economic Performance, LSE.
    2. Yihan Liao, 2025. "Microeconomic Shock Propagation Through Production Networks in China," Mathematics, MDPI, vol. 13(3), pages 1-36, January.
    3. Francisco J. Buera & Nicholas Trachter, 2024. "Sectoral Development Multipliers," NBER Working Papers 32230, National Bureau of Economic Research, Inc.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:jpolec:doi:10.1086/725703. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Journals Division (email available below). General contact details of provider: https://www.journals.uchicago.edu/JPE .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.