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Protección y productividad: Causas y consecuencias de aislar sectores en una economía pequeña

Author

Listed:
  • Cecilia Durán

    (Asesoría Política y Comercial, Ministerio de Economía y Finanzas, Uruguay.)

  • Natalia Ferreira-Coimbra

    (Departamento de Economía, Facultad de Ciencias Sociales, Universidad de la República)

Abstract

This paper aims to identify the productive sectors that can be isolated from international competition, analyzing the impact on productivity arising from a trade liberalization process. We focused on the case of Uruguay and select a basket of goods that show signs of not being competitive on a non-national scale and, at the same time, have a protection tool that takes the form of non-tariff barriers. In turn, we analyze the effects of protection on sector productivity through a difference-in-difference approach, finding that domestic protection in a context of economic liberalization has a negative impact on firms' productivity. Finally, a quick analysis from the political economy reveals that there are winners and losers in the process of trade liberalization. This makes the exclusion of sensitive sectors a viable mechanism for an opening that otherwise would not be a political equilibrium.

Suggested Citation

  • Cecilia Durán & Natalia Ferreira-Coimbra, 2010. "Protección y productividad: Causas y consecuencias de aislar sectores en una economía pequeña," Documentos de Trabajo (working papers) 2810, Department of Economics - dECON.
    • Handle: RePEc:ude:wpaper:2810
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    File URL: https://hdl.handle.net/20.500.12008/2182
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    References listed on IDEAS

    as
    1. Trefler, Daniel, 1993. "Trade Liberalization and the Theory of Endogenous Protection: An Econometric Study of U.S. Import Policy," Journal of Political Economy, University of Chicago Press, vol. 101(1), pages 138-160, February.
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    4. Grossman, Gene M & Helpman, Elhanan, 1994. "Protection for Sale," American Economic Review, American Economic Association, vol. 84(4), pages 833-850, September.
    5. Olarreaga, Marcelo & Soloaga, Isidro, 1998. "Endogenous Tariff Formation: The Case of Mercosur," The World Bank Economic Review, World Bank, vol. 12(2), pages 297-320, May.
    6. James Levinsohn & Amil Petrin, 2003. "Estimating Production Functions Using Inputs to Control for Unobservables," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 70(2), pages 317-341.
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    9. Julio Berlinsky (coordinador) & Honório Kume (coordinador) & Marcel Vaillant (coordinador) & Guida Piani & Álvaro Ons & Pedro Miranda & Carlos Romero & Red MERCOSUR, 2006. "Hacia una política comercial común del MERCOSUR," Serie Red MERCOSUR, Red Mercosur, edition 1, volume 1, number 5 edited by Red MERCOSUR, Spring.
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    More about this item

    Keywords

    trade protection; non–tariff barriers; productivity; difference in–difference model;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations

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