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Import Intensity and Firm Productivity - An Empirical Analysis Based on Swedish Firm-Level Data

Holmgren, Adam LU (2016) NEKN01 20161
Department of Economics
Abstract (Swedish)
Most exporting firms in the world also import foreign inputs in production. Recent findings elucidate the importance of imports as a driver of firm productivity on the amount of goods exported. This study aims at investigating the correlation between imports and firm productivity, not the causality. It will add to previous research by shifting focus from import participation to import intensity and outline if trading firms may increase their import intensity to gain productivity effects. Based on a firm-level survey in the Swedish manufacturing sector during 2014, a (Pseudo) Poisson Maximum Likelihood estimator is used in the empirical analysis. We find a positive correlation between import intensity and firm productivity. This finding is... (More)
Most exporting firms in the world also import foreign inputs in production. Recent findings elucidate the importance of imports as a driver of firm productivity on the amount of goods exported. This study aims at investigating the correlation between imports and firm productivity, not the causality. It will add to previous research by shifting focus from import participation to import intensity and outline if trading firms may increase their import intensity to gain productivity effects. Based on a firm-level survey in the Swedish manufacturing sector during 2014, a (Pseudo) Poisson Maximum Likelihood estimator is used in the empirical analysis. We find a positive correlation between import intensity and firm productivity. This finding is in line with heterogeneous firm theory, from which we argue, that these productivity effects are mainly benefiting high productive firms. Policies acting to decrease trade restrictions might help low productive domestic firms surpass the productivity verge, enter the import market and benefit from increasing import intensity (Less)
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author
Holmgren, Adam LU
supervisor
organization
course
NEKN01 20161
year
type
H1 - Master's Degree (One Year)
subject
keywords
Import Intensity, Firm Productivity, Sweden
language
English
id
8878512
date added to LUP
2016-06-22 14:26:19
date last changed
2016-06-22 14:26:19
@misc{8878512,
  abstract     = {Most exporting firms in the world also import foreign inputs in production. Recent findings elucidate the importance of imports as a driver of firm productivity on the amount of goods exported. This study aims at investigating the correlation between imports and firm productivity, not the causality. It will add to previous research by shifting focus from import participation to import intensity and outline if trading firms may increase their import intensity to gain productivity effects. Based on a firm-level survey in the Swedish manufacturing sector during 2014, a (Pseudo) Poisson Maximum Likelihood estimator is used in the empirical analysis. We find a positive correlation between import intensity and firm productivity. This finding is in line with heterogeneous firm theory, from which we argue, that these productivity effects are mainly benefiting high productive firms. Policies acting to decrease trade restrictions might help low productive domestic firms surpass the productivity verge, enter the import market and benefit from increasing import intensity},
  author       = {Holmgren, Adam},
  keyword      = {Import Intensity,Firm Productivity,Sweden},
  language     = {eng},
  note         = {Student Paper},
  title        = {Import Intensity and Firm Productivity - An Empirical Analysis Based on Swedish Firm-Level Data},
  year         = {2016},
}