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Import Penetration, Intermediate Inputs and Firms’ Productivity in the EU Food Industry

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  • Olper, Alessandro
  • Curzi, Daniele
  • Raimondi, Valentina

Abstract

The aim of this contribution is to study empirically the effect of trade liberalization on productivity growth exploiting a large micro-dataset of more than 20,000 French and Italian food firms, over the 2004-2012 period. This relationship has been studied focusing on import penetration at both industry and upstream sectors level, to investigate the role played by imports in intermediate inputs. Main findings show that import penetration in both final products and intermediate inputs systematically contributed to firm-level productivity growth. Yet, the productivity growth effect induced by import penetration in upstream sectors is 10 times higher than the one at the industry level. Horizontal import competition coming from the EU15 and OECD countries exerts the strongest effect on productivity growth. By contrast, when vertical import penetration is considered, also sourcing intermediate inputs from emerging markets appears important for firms’ productivity growth. Finally, we also find a strong confirmation that the effects of import penetration are increasing with the initial level of firms’ productivity. All these stylized facts may have interesting policy implications.

Suggested Citation

  • Olper, Alessandro & Curzi, Daniele & Raimondi, Valentina, 2015. "Import Penetration, Intermediate Inputs and Firms’ Productivity in the EU Food Industry," 2015 Allied Social Sciences Association (ASSA) Annual Meeting, January 3-5, 2015, Boston, Massachusetts 189691, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:assa15:189691
    DOI: 10.22004/ag.econ.189691
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    File URL: https://ageconsearch.umn.edu/record/189691/files/Olper_%20A%20_2_.pdf
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    References listed on IDEAS

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    1. Luca Salvatici & Silvia Nenci, 2017. "New features, forgotten costs and counterfactual gains of the international trading system," European Review of Agricultural Economics, Foundation for the European Review of Agricultural Economics, vol. 44(4), pages 592-633.

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    More about this item

    Keywords

    Food Consumption/Nutrition/Food Safety; Production Economics;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration
    • F61 - International Economics - - Economic Impacts of Globalization - - - Microeconomic Impacts
    • L66 - Industrial Organization - - Industry Studies: Manufacturing - - - Food; Beverages; Cosmetics; Tobacco
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

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