Size Rationalization and Trade Exposure in Developing Countries
In: Empirical Studies of Commercial Policy
Given the lack of direct evidence regarding industrial adjustment in response to trade liberalization, this paper tackles some very basic questions. Specifically, in LDCs, how is trade orientation correlated with the size distribution of plants and with plant-level labor productivity? It begins with a simple model that summarizes some effects of trade exposure on producer size and productive efficiency that have been stressed in the recent analytical and simulation literature. It then examines annual plant-level data from Chile and Colombia to determine whether these effects can be confirmed. The empirical results indicate that, over the long run, higher trade exposure is correlated with smaller plant sizes, controlling for industry and country effects. However, the mix of high versus low productivity plants is not strongly associated with trade exposure. Both of these findings cast doubt on the mechanisms linking trade, plant size, and productivity in a number of recent analytical and simulation studies.
(This abstract was borrowed from another version of this item.)
|This chapter was published in: ||This item is provided by National Bureau of Economic Research, Inc in its series NBER Chapters with number
6713.||Handle:|| RePEc:nbr:nberch:6713||Contact details of provider:|| Postal: |
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Dani Rodrik, 1988. "Imperfect Competition, Scale Economies, and Trade Policy in Developing Countries," NBER Chapters, in: Trade Policy Issues and Empirical Analysis, pages 109-144 National Bureau of Economic Research, Inc.
- de Melo, Jaime, 1988. "Computable general equilibrium models for trade policy analysis in developing countries: A survey," Journal of Policy Modeling, Elsevier, vol. 10(4), pages 469-503.
- Condon, Timothy & de Melo, Jaime, 1990.
"Industrial organization implications of QR trade regimes : evidence and welfare costs,"
Policy Research Working Paper Series
487, The World Bank.
- Condon, Timothy & de Melo, Jaime, 1991. "Industrial Organization Implications of QR Trade Regimes: Evidence and Welfare Costs," Empirical Economics, Springer, vol. 16(1), pages 139-53.
- Brown, Drusilla K., 1991.
"Tariffs and capacity utilization by monopolistically competitive firms,"
Journal of International Economics,
Elsevier, vol. 30(3-4), pages 371-381, May.
- Brown, D.K., 1988. "Tariffs And Capacity Utilization By Monopolistically Competitive Firms," Working Papers 229, Research Seminar in International Economics, University of Michigan.
- Devarajan, Shantayanan & Rodrik, Dani, 1989. "Trade Liberalization in Developing Countries: Do Imperfect Competition and Scale Economies Matter?," American Economic Review, American Economic Association, vol. 79(2), pages 283-87, May.
- Horstmann, Ignatius J. & Markusen, James R., 1986. "Up the average cost curve: Inefficient entry and the new protectionism," Journal of International Economics, Elsevier, vol. 20(3-4), pages 225-247, May.
- Buffie, Edward F. & Spiller, Pablo T., 1986. "Trade liberalization in oligopolistic industries : The quota case," Journal of International Economics, Elsevier, vol. 20(1-2), pages 65-81, February.
- Devarajan, Shantayanan & Rodrik, Dani, 1991.
"Pro-competitive effects of trade reform : Results from a CGE model of Cameroon,"
European Economic Review,
Elsevier, vol. 35(5), pages 1157-1184, July.
- Shantayanan Devarajan & Dani Rodrik, 1989. "Pro-Competitive Effects of Trade Reform: Results from a CGE Model of Cameroon," NBER Working Papers 3176, National Bureau of Economic Research, Inc.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberch:6713. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.