Imports and TFP at the firm level: the role of absorptive capacity

Patricia Augier (1) , Olivier Cadot (2, 3, 4, 5) , Marion Dovis (1)

1 GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille
2 Institut d'Economie Appliquée
3 CEPR - Center for Economic Policy Research
4 CEPREMAP - Centre pour la recherche économique et ses applications
5 FERDI - Fondation pour les Etudes et Recherches sur le Développement International

This paper estimates the effect of the decision to import intermediate goods and capital equipment on Total Factor Productivity (TFP) at the firm level on a panel of Spanish firms (19912002). We use two alternative approaches. In the first, we estimate TFP and apply a diffindiff estimator with a control group constructed by propensityscore matching. In the second, direct method, we estimate TFP with imported inputs as a state variable in one stage. Both approaches show that the effect of a firm's decision to source intermediates and capital equipment abroad on its TFP depends critically on its capacity to absorb technology, measured by the proportion of skilled labour.

Keywords: Economie quantitative

Domains: Humanities and Social Sciences; Humanities and Social Sciences; Economics and Finance

Patricia Augier, Olivier Cadot, Marion Dovis. Imports and TFP at the firm level: the role of absorptive capacity. Canadian Journal of Economics, 2013, 46 (3), pp.956-981. ⟨10.1111/caje.12034⟩. ⟨hal-01498268⟩