The seminar will be held in the Visitor Centre at 3 pm.
Béla Személy: Duke, KOZ visitor
In this paper, I measure to what extent international trade affects factor reallocations andthrough it aggregate productivity, using firm level data from the Hungarian manufacturing sector for the period 1992-2002. First, I quantify in what way factor reallocations influence aggregate productivity by decomposing the productivity growth index into its components: firms’ own productivity increase and changes in the share of firms’ value added in the industry. Then, I look at how the increase in competition, coming from trade liberalization, influences the evolution of aggregate productivity growth and its components. The results confirm the productivity enhancing effect of international competition, a 10% increase in international competition leads to a 16% increase in the aggregate productivity, where about 80% of the improvements are coming from factor reallocations.
A previous draft is downloadable