How firms accumulate inputs: Evidence from import switching

• 成果类型: Article
• 署名作者: Lu, Dan; Mariscal, Asier; Mejia, Luis -Fernando
• 署名单位: Chinese University of Hong Kong
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2023.103847
• 发表日期: 2024
• 关键词: firms; intermediate inputs; Suppliers; Intangible capital accumulation; Input heterogeneity; Input choice; Firm lifecycle; Input switching

摘要

We uncover new dynamic facts in Colombian manufacturing importers' data. First, imported input switching, a firm's simultaneous adding and dropping of foreign intermediates, is pervasive and a substantial fraction of firm's imports. Second, larger firms switch more conditional on age, whereas younger firms switch more conditional on size. Third, the number of imported varieties increases with firm age. Fourth, inputs of lower expenditure are more frequently dropped. Fifth, firms that switch more, have larger sales growth. Analogous facts also hold for suppliers. We propose a dynamic model where firms accumulate foreign suppliers and choose which heterogeneously productive intermediates to import. A firm compares each input's productivity across suppliers and keeps the best source, switching, lowering its unit cost, and growing in size. In the calibrated model, a 20% tariff reduction: (1) generates a 5.2% increase in welfare across steady states, and (2) upon impact only 76% of the gains accrue.