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Input-Trade Liberalization, Export Prices and Quality Upgrading

Author

Listed:
  • Maria Bas

    (CEPII - Centre d'Etudes Prospectives et d'Informations Internationales - Centre d'analyse stratégique, Sciences Po - Sciences Po)

  • Vanessa Strauss-Kahn

    (ESCP-EAP - ESCP-EAP - Ecole Supérieure de Commerce de Paris)

Abstract

This paper explores the impact of input-trade liberalization on imported input and exported product prices. Using Chinese transaction data for 2000-2006, we capture causal effects between exogenous input tarif reductions and within firm changes in HS6 traded product prices. Identifcation is based on a quasi-natural experiment where some forms are exempt from paying tariffs and stand as a control group. Both imported input and export prices rise. The effect on export prices is specific to forms sourcing inputs from developed economies and exporting output to high-income countries. Results are consistent with a scenario within which forms exploit the input tariff cuts to access high-quality inputs in order to quality-upgrade their exports.

Suggested Citation

  • Maria Bas & Vanessa Strauss-Kahn, 2013. "Input-Trade Liberalization, Export Prices and Quality Upgrading," SciencePo Working papers hal-03460775, HAL.
    • Handle: RePEc:hal:wpspec:hal-03460775
    Note: View the original document on HAL open archive server: https://hal-sciencespo.archives-ouvertes.fr/hal-03460775
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    File URL: https://hal-sciencespo.archives-ouvertes.fr/hal-03460775/document
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    References listed on IDEAS

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    8. Bas, Maria, 2012. "Input-trade liberalization and firm export decisions: Evidence from Argentina," Journal of Development Economics, Elsevier, vol. 97(2), pages 481-493.
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    13. Bastos, Paulo & Silva, Joana, 2010. "The quality of a firm's exports: Where you export to matters," Journal of International Economics, Elsevier, vol. 82(2), pages 99-111, November.
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    Cited by:

    1. Ganguly, Shrimoyee & Acharyya, Rajat, 2022. "Devaluation, Export Quality and Employment in A Small Dependent Economy," Journal of Economic Development, The Economic Research Institute, Chung-Ang University, vol. 47(1), pages 137-165, March.

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    More about this item

    Keywords

    Firm heterogeneity; imported inputs; trade liberatization; export prices; quality upgrade; mark-up;
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