From Firm-Level Imports to Aggregate Productivity: Evidence from Korean Manufacturing Firms Data
37 Pages Posted: 29 Apr 2016
Date Written: April 27, 2016
Using the Korean manufacturing firm-level data, this paper confirms that three stylized facts on importing hold in Korea: the ratio of imported inputs in total inputs tends to be pro-cyclical; the use of imported inputs increases productivity; and larger firms are more likely to use imported inputs. As a result, we find that firm-level import decisions explain a non-trivial fraction of aggregate productivity fluctuations in Korea over the period between 2006 and 2012. Main findings of this paper suggest a possible link between the recent global productivity slowdown and the global trade slowdown.
Keywords: Firm-level imports, Productivity pro-cyclicality, Aggregate TFP of manufacturing sector
JEL Classification: E3, F1, F4, O4
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