Use of Imported Inputs and the Cost of Importing: Evidence from Developing Countries

12 Pages Posted: 20 Apr 2016

See all articles by Asif Islam

Asif Islam

World Bank - Development Economics Group (DEC)

Mohammad Amin

World Bank - Enterprise Analysis Unit

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Date Written: August 1, 2014

Abstract

For a representative sample of manufacturing firms in 26 countries, this paper shows that changes in the cost of importing over time are significantly and negatively correlated with changes in the percentage of firms' material inputs that are of foreign origin. Furthermore, the paper shows that there may be a nonlinear relationship between import costs and imports. These findings are important, as recent studies point toward a significant positive effect of imported inputs on productivity and growth. It is hoped that the present paper inspires more work on the determinants of the use of imported inputs, especially in developing countries.

Keywords: Trade Facilitation, Trade Policy, Customs Administration, International Trade and Trade Rules, Rules of Origin, Trade and Multilateral Issues

Suggested Citation

Islam, Asif Mohammed and Amin, Mohammad, Use of Imported Inputs and the Cost of Importing: Evidence from Developing Countries (August 1, 2014). World Bank Policy Research Working Paper No. 7005. Available at SSRN: https://ssrn.com/abstract=2482756

Asif Mohammed Islam

World Bank - Development Economics Group (DEC) ( email )

1818 H Street N.W.
Washington, DC 20433
United States

Mohammad Amin (Contact Author)

World Bank - Enterprise Analysis Unit ( email )

2121 Pennsylvania Avenue, NW
Washington, DC 20433
United States

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