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Tariff Rates, Offshoring and Productivity: Evidence from German and Austrian Firm-Level Data

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  • Hansen, Thorsten

Abstract

This paper studies the impact of trade liberalization in terms of tarif cuts within the Eastern European enlargement on German and Austrian firm productivity. Unique matching of data from 1994 to 2003 suggests that tarif reductions raise parent firm productivity significantly. A ten percentage point decrease in tarif rates can lead to total factor productivity gains of up to 2 percent. The data allow distinction between three types of tarifs: output, intra-firm and input tarif rates. The size of the results strongly depends on the type of tarif and country analyzed.

Suggested Citation

  • Hansen, Thorsten, 2010. "Tariff Rates, Offshoring and Productivity: Evidence from German and Austrian Firm-Level Data," Discussion Papers in Economics 11465, University of Munich, Department of Economics.
  • Handle: RePEc:lmu:muenec:11465
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    More about this item

    Keywords

    tariff rates; intra-firm trade; productivity; trade liberalization;

    JEL classification:

    • F12 - International Economics - - Trade - - - Models of Trade with Imperfect Competition and Scale Economies; Fragmentation
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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