Exports and Productivity : The Role of Imported Inputs and Investment in R&D

The empirical evidence on within firm productivity improvements from exports has largely been understated because the measures of revenue productivity used do not account for pricing heterogeneity across firms. Using a panel of Indian firms, the an...

Full description

Bibliographic Details
Main Author:	Manghnani, Ruchita
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2020
Subjects:	GAINS FROM TRADE PRODUCTIVITY PRICING HETEROGENEITY EXPORTS IMPORTS RESEARCH AND DEVELOPMENT R&D
Online Access:	http://documents.worldbank.org/curated/en/182351592321765811/Exports-and-Productivity-The-Role-of-Imported-Inputs-and-Investment-in-R-D http://hdl.handle.net/10986/33942

id	okr-10986-33942
recordtype	oai_dc
spelling	okr-10986-339422022-09-20T00:12:40Z Exports and Productivity : The Role of Imported Inputs and Investment in R&D Manghnani, Ruchita GAINS FROM TRADE PRODUCTIVITY PRICING HETEROGENEITY EXPORTS IMPORTS RESEARCH AND DEVELOPMENT R&D The empirical evidence on within firm productivity improvements from exports has largely been understated because the measures of revenue productivity used do not account for pricing heterogeneity across firms. Using a panel of Indian firms, the analysis in this paper controls for firm variation in prices and uses proxy methods to retrieve measures of productivity that reflect physical productivity. Within-firm productivity changes from export entry are computed using a difference-in-differences matching estimator. The findings show that, over a six-year period, the difference in productivity growth between export entrants and their non-exporter counterparts is about 11 percentage points. Thus, productivity improvements from selling in international markets have largely been understated in the export-productivity empirical literature. This difference in productivity growth is decomposed into two channels. About 15 percent of the difference in productivity growth is explained by higher imports of intermediate inputs, and about 85 percent is explained by investment in research and development. The evidence suggests that investment in research and development is an important source of within-firm productivity gains even in developing countries. 2020-06-18T15:26:39Z 2020-06-18T15:26:39Z 2020-06 Working Paper http://documents.worldbank.org/curated/en/182351592321765811/Exports-and-Productivity-The-Role-of-Imported-Inputs-and-Investment-in-R-D http://hdl.handle.net/10986/33942 English Policy Research Working Paper;No. 9281 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper South Asia India
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	GAINS FROM TRADE PRODUCTIVITY PRICING HETEROGENEITY EXPORTS IMPORTS RESEARCH AND DEVELOPMENT R&D
spellingShingle	GAINS FROM TRADE PRODUCTIVITY PRICING HETEROGENEITY EXPORTS IMPORTS RESEARCH AND DEVELOPMENT R&D Manghnani, Ruchita Exports and Productivity : The Role of Imported Inputs and Investment in R&D
geographic_facet	South Asia India
relation	Policy Research Working Paper;No. 9281
description	The empirical evidence on within firm productivity improvements from exports has largely been understated because the measures of revenue productivity used do not account for pricing heterogeneity across firms. Using a panel of Indian firms, the analysis in this paper controls for firm variation in prices and uses proxy methods to retrieve measures of productivity that reflect physical productivity. Within-firm productivity changes from export entry are computed using a difference-in-differences matching estimator. The findings show that, over a six-year period, the difference in productivity growth between export entrants and their non-exporter counterparts is about 11 percentage points. Thus, productivity improvements from selling in international markets have largely been understated in the export-productivity empirical literature. This difference in productivity growth is decomposed into two channels. About 15 percent of the difference in productivity growth is explained by higher imports of intermediate inputs, and about 85 percent is explained by investment in research and development. The evidence suggests that investment in research and development is an important source of within-firm productivity gains even in developing countries.
format	Working Paper
author	Manghnani, Ruchita
author_facet	Manghnani, Ruchita
author_sort	Manghnani, Ruchita
title	Exports and Productivity : The Role of Imported Inputs and Investment in R&D
title_short	Exports and Productivity : The Role of Imported Inputs and Investment in R&D
title_full	Exports and Productivity : The Role of Imported Inputs and Investment in R&D
title_fullStr	Exports and Productivity : The Role of Imported Inputs and Investment in R&D
title_full_unstemmed	Exports and Productivity : The Role of Imported Inputs and Investment in R&D
title_sort	exports and productivity : the role of imported inputs and investment in r&d
publisher	World Bank, Washington, DC
publishDate	2020
url	http://documents.worldbank.org/curated/en/182351592321765811/Exports-and-Productivity-The-Role-of-Imported-Inputs-and-Investment-in-R-D http://hdl.handle.net/10986/33942
_version_	1764479847313178624

Exports and Productivity : The Role of Imported Inputs and Investment in R&D

Similar Items