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Trade and technology: New evidence on the productivity sorting of firms

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  • Bertschek, Irene
  • Hogrefe, Jan
  • Rasel, Fabienne

Abstract

Using a unique German firm-level data set, we provide empirical evidence for a productivity sorting along two dimensions: international activity and technology choice. We consider domestic and exporting firms and measure technology choice by firms' actual use of advanced information technology (IT). For manufacturing firms, the observed sorting pattern is consistent with recent theories of heterogeneous firms and technology choice: Only the relatively more productive ones among internationally active firms are also highly technology intensive. For service sector firms we find similar evidence, yet the results seem to depend on the trade cost of certain services. In general, recent theoretical advances regarding trade and technology adoption thus seem to better fit the manufacturing sector.

Suggested Citation

  • Bertschek, Irene & Hogrefe, Jan & Rasel, Fabienne, 2013. "Trade and technology: New evidence on the productivity sorting of firms," ZEW Discussion Papers 13-042, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  • Handle: RePEc:zbw:zewdip:13042
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    References listed on IDEAS

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    7. Alla Lileeva & Daniel Trefler, 2010. "Improved Access to Foreign Markets Raises Plant-level Productivity…For Some Plants," The Quarterly Journal of Economics, Oxford University Press, vol. 125(3), pages 1051-1099.
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    12. Marc J. Melitz, 2003. "The Impact of Trade on Intra-Industry Reallocations and Aggregate Industry Productivity," Econometrica, Econometric Society, vol. 71(6), pages 1695-1725, November.
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    Cited by:

    1. Rasel, Fabienne, 2015. "ICT and global sourcing: Evidence for German manufacturing and service firms," ZEW Discussion Papers 15-086, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    2. Rasel, Fabienne, 2014. "Combining technology and work organization: An analysis of complementarity between IT and decentralization across firms of different size," ZEW Discussion Papers 14-071, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    3. Lüdering, Jochen, 2014. "The measurement of internet availability and quality in the context of the discussion on digital divide," Discussion Papers 65, Justus Liebig University Giessen, Center for international Development and Environmental Research (ZEU).
    4. Rasel, Fabienne, 2013. "Produktivitätsverteilung angesichts von Auslandsaktivität und Technologieintensität," ZEW Wachstums- und Konjunkturanalysen, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research, pages 10-11.

    More about this item

    Keywords

    exports; productivity; sorting; information technology; firm-level data;

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production

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