Input prices, productivity, and trade dynamics: long-run effects of liberalization on Chinese paint manufacturers

• 成果类型: Article
• 署名作者: Grieco, Paul L. E.; Li, Shengyu; Zhang, Hongsong
• 署名单位: Pennsylvania Commonwealth System of Higher Education (PCSHE); Pennsylvania State University; Pennsylvania State University - University Park; University of New South Wales Sydney; University of Hong Kong
• 刊物名称: RAND JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0741-6261
• DOI: 10.1111/1756-2171.12420
• 发表日期: 2022
• 页码: 516-560
• 关键词: research-and-development; intermediate inputs; imported inputs; QUALITY; substitution; elasticity; IMPACT; COSTS; Heterogeneity; performance

摘要

We develop a dynamic model to analyze the impact of input tariff liberalization on input prices, trading decisions, and productivity. Although input tariffs directly affect input price benefits of importing, their impact on trade participation generates indirect benefits through productivity improvements and complementarity between importing and exporting. To disentangle these effects, we separately measure importing's effect on input prices and productivity and examine Chinese paint manufacturers' reaction to input tariff liberalization. We find that a mild short-term effect of tariff liberalization is amplified in the long run by induced trade participation, resulting in even higher productivity and lower input prices.